Starborn Company has just been established as a new company to manufacture furniture. The company expects to earn $1 million after-taxes during its first year. The company president has asked for a projected balance sheet based on ratios similar to the industry average. Assuming all sales are made on credit, calculations utilize a 365-day year, and final numbers are rounded to the nearest thousand, prepare a projected balance sheet for Starborn based on the following industry ratios: Current Ratio: 2:1 Quick Ratio: 1:1 Net Profit Margin: 10% Average Collection Period: 20 days Debt Ratio: 40% Total Asset Turnover Ratio: 2 times Current Liabilities/Stockholder's Equity: 20% Create your balance sheet based on the following format: Cash   Total Current Liabilities   Accounts Receivable   Long-term Debt   Inventory        Total Debt        Total Current       Assets   Stockholder's Equity   Net Fixed Assets        Total                     Liabilities              and                   Stockholder's         Equity        Total Assets

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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Starborn Company has just been established as a new company to manufacture furniture. The company expects to earn $1 million after-taxes during its first year. The company president has asked for a projected balance sheet based on ratios similar to the industry average.

Assuming all sales are made on credit, calculations utilize a 365-day year, and final numbers are rounded to the nearest thousand, prepare a projected balance sheet for Starborn based on the following industry ratios:

Current Ratio: 2:1

Quick Ratio: 1:1

Net Profit Margin: 10%

Average Collection Period: 20 days

Debt Ratio: 40%

Total Asset Turnover Ratio: 2 times

Current Liabilities/Stockholder's Equity: 20%

Create your balance sheet based on the following format:

Cash

  Total Current Liabilities  
Accounts Receivable   Long-term Debt  
Inventory        Total Debt  
     Total Current       Assets   Stockholder's Equity  
Net Fixed Assets        Total                     Liabilities              and                   Stockholder's         Equity  
     Total Assets      
Problem 1:
Starborn Company has just been established as a new company to manufacture furniture. The company
expects to earn $1 million after-taxes during its first year. The company president has asked for a
projected balance sheet based on ratios similar to the industry average.
Assuming all sales are made on credit, calculations utilize a 365-day year, and final numbers are rounded
to the nearest thousand, prepare a projected balance sheet for Starborn based on the following industry
ratios:
Industry
Averages
Current Ratio
Quick Ratio
Net profit margin ratio
Average collection period
Debt ratio
Total asset turnover ratio
Current liabilities/stockholders' equity
2:1
1:1
10%
20 days
40%
2 times
20%
Create your projected balance sheet based on the following format:
Cash
Total current liabilities
Accounts receivable
Long-tem debt
Inventory
Total debt
Total current assets
Stockholders' equity
Net fixed assets
Total liabilities and stockholders' equity
Total assets
Transcribed Image Text:Problem 1: Starborn Company has just been established as a new company to manufacture furniture. The company expects to earn $1 million after-taxes during its first year. The company president has asked for a projected balance sheet based on ratios similar to the industry average. Assuming all sales are made on credit, calculations utilize a 365-day year, and final numbers are rounded to the nearest thousand, prepare a projected balance sheet for Starborn based on the following industry ratios: Industry Averages Current Ratio Quick Ratio Net profit margin ratio Average collection period Debt ratio Total asset turnover ratio Current liabilities/stockholders' equity 2:1 1:1 10% 20 days 40% 2 times 20% Create your projected balance sheet based on the following format: Cash Total current liabilities Accounts receivable Long-tem debt Inventory Total debt Total current assets Stockholders' equity Net fixed assets Total liabilities and stockholders' equity Total assets
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