please anser and explain Including the new proposed term loan, what is Nuts n' Seeds Incorporated's 20Y0 total liabilities to equity ratio if you: 1) treated the shareholder loan as equity rather than as a liability, and 2) tested the operating line as fully drawn? (see attached balance sheet) A. 1.10 B. 1.25 C. 1.15 D. 1.20
please anser and explain Including the new proposed term loan, what is Nuts n' Seeds Incorporated's 20Y0 total liabilities to equity ratio if you: 1) treated the shareholder loan as equity rather than as a liability, and 2) tested the operating line as fully drawn? (see attached balance sheet) A. 1.10 B. 1.25 C. 1.15 D. 1.20
Financial Accounting Intro Concepts Meth/Uses
14th Edition
ISBN:9781285595047
Author:Weil
Publisher:Weil
Chapter4: Balance Sheet: Presenting And Analyzing Resources And Financing
Section: Chapter Questions
Problem 14E
Related questions
Question
please anser and explain
Including the new proposed term loan, what is Nuts n' Seeds Incorporated's 20Y0 total liabilities to equity ratio if you: 1) treated the shareholder loan as equity rather than as a liability, and 2) tested the operating line as fully drawn? (see attached balance sheet)
A. 1.10
B. 1.25
C. 1.15
D. 1.20
![P13
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A
ASSETS
CURRENT
X
Cash
Sales tax receivable
Inventory
Accounts receivable
EQUIPMENT (Aora 3)
Total Assets
B
LIABILITIES
CURRENT
Accounts payable and accrued liabilitie
Bank line of credit
Current portion of long-term debt
Salaries payable
DUE TO SHAREHOLDERS
LONG-TERM DEBT
Total Equity
fx
SHAREHOLDERS' EQUITY
Share capital Wote 4)
Retained earnings
Current Assets:
Current Liabilities:
Current Ratio:
Total Liabilities:
Total Equity:
Total Liabilities to Equity:
Cover Page
с
20Y0
$275,879
15.127
790,535
387,517
1,469,058
803,658
$2,272,716
$325,514
500,000
33,333
15,430
874,278
914,412
166,667
1,955,357
Total Liabilities and Shareholder: $2,272,716
100
317,259
317,359
D
E
20X9
Nuts n' Seeds Incorporated
$72.517
15,959
796.513
362.885
1,247,874
692,554
$1,940,428
$324,554
441,589
13,955
780,098
914,412
1,694,510
100
245,818
245.918
$1,940,428
F
REVENUES
COST OF SALES
GROSS MARGIN
EXPENSES
Advertising and promotion
Bank charges
Business taxes, licenses and memberships
Courier and postage
Depreciation
Insurance
G
Interest
Office and administration
Repairs and maintenance
Rent and occupancy
Salaries and wages
Software and computers
Telephone
Warehouse
NET INCOME BEFORE INCOME TAXI
INCOME TAXES
NET INCOME
Total Funded Debt
Funded Debt to EBITDA
H
EBITDA:
Credit Line Interest:
Existing Annual Term Loan Blended Payments:
New Annual Term Loan Blended Payments:
Debt Service Coverage Ratio:
20Y0
$2,571,705
1,697,325
874,380
23,541
11,648
13,297
10,271
115,727
3,941
68,495
6,132
12,861
81,372
365,182
6,137
1,507
64,968
785,079
89,301
17,860
$71,441
I
J
20X9
$2,296,165
1,554,917
741,248
17,185
9,886
9,147
6,238
94,722
3,516
29,638
5,286
9.214
81,178
315,950
4,288
958
56,255
643,461
97,787
18,761
$79,026
K
L
Credit Line:
Spread:
Prime:
Total Rate:
Existing Term Loan:
Amortization (months):
Rate:
Rate Monthly:
Monthly Payment:
Total Annual Payments:
New Term Loan:
Amortization (months):
Rate:
Rate Monthly:
Monthly Payment:
Total Annual Payments:
M
500,000
3.00%
500,000
84
5.50%
N
0
P
Q
R
S
X
EL](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fd809a187-b996-4c76-a22c-99cbcc0816e9%2F4ca3fd45-a8fe-4f12-9184-fc4e84da421d%2F9dqfu7d_processed.png&w=3840&q=75)
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49
A
ASSETS
CURRENT
X
Cash
Sales tax receivable
Inventory
Accounts receivable
EQUIPMENT (Aora 3)
Total Assets
B
LIABILITIES
CURRENT
Accounts payable and accrued liabilitie
Bank line of credit
Current portion of long-term debt
Salaries payable
DUE TO SHAREHOLDERS
LONG-TERM DEBT
Total Equity
fx
SHAREHOLDERS' EQUITY
Share capital Wote 4)
Retained earnings
Current Assets:
Current Liabilities:
Current Ratio:
Total Liabilities:
Total Equity:
Total Liabilities to Equity:
Cover Page
с
20Y0
$275,879
15.127
790,535
387,517
1,469,058
803,658
$2,272,716
$325,514
500,000
33,333
15,430
874,278
914,412
166,667
1,955,357
Total Liabilities and Shareholder: $2,272,716
100
317,259
317,359
D
E
20X9
Nuts n' Seeds Incorporated
$72.517
15,959
796.513
362.885
1,247,874
692,554
$1,940,428
$324,554
441,589
13,955
780,098
914,412
1,694,510
100
245,818
245.918
$1,940,428
F
REVENUES
COST OF SALES
GROSS MARGIN
EXPENSES
Advertising and promotion
Bank charges
Business taxes, licenses and memberships
Courier and postage
Depreciation
Insurance
G
Interest
Office and administration
Repairs and maintenance
Rent and occupancy
Salaries and wages
Software and computers
Telephone
Warehouse
NET INCOME BEFORE INCOME TAXI
INCOME TAXES
NET INCOME
Total Funded Debt
Funded Debt to EBITDA
H
EBITDA:
Credit Line Interest:
Existing Annual Term Loan Blended Payments:
New Annual Term Loan Blended Payments:
Debt Service Coverage Ratio:
20Y0
$2,571,705
1,697,325
874,380
23,541
11,648
13,297
10,271
115,727
3,941
68,495
6,132
12,861
81,372
365,182
6,137
1,507
64,968
785,079
89,301
17,860
$71,441
I
J
20X9
$2,296,165
1,554,917
741,248
17,185
9,886
9,147
6,238
94,722
3,516
29,638
5,286
9.214
81,178
315,950
4,288
958
56,255
643,461
97,787
18,761
$79,026
K
L
Credit Line:
Spread:
Prime:
Total Rate:
Existing Term Loan:
Amortization (months):
Rate:
Rate Monthly:
Monthly Payment:
Total Annual Payments:
New Term Loan:
Amortization (months):
Rate:
Rate Monthly:
Monthly Payment:
Total Annual Payments:
M
500,000
3.00%
500,000
84
5.50%
N
0
P
Q
R
S
X
EL
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