The December 31, 2019, balance sheet for Walton Corporation is presented here. These are the only accounts on Walton’s balance sheet. Amounts indicated by question marks (?) can be calculated using the following additional information: WALTON CORPORATIONBalance Sheet As of December 31, 2019Assets Cash$35,000 Accounts receivable (net) ? Inventory ? Property, plant, and equipment (net) 305,000 $452,000 Liabilities and Stockholders’ Equity Accounts payable (trade)$? Income taxes payable (current) 35,000 Long-term debt ? Common stock 311,000 Retained earnings ? $? Additional Information Current ratio (at year end)1.4 to 1.0Total liabilities ÷ Total stockholders’ equity 60%Gross margin percentage 40%Inventory turnover (Cost of goods sold ÷ Ending inventory) 10.5timesGross margin for 2019$350,000 RequiredCompute the balance in trade accounts payable as of December 31, 2019.Compute the balance in retained earnings as of December 31, 2019.Compute the balance in the inventory account as of December 31, 2019. (Assume that the level of inventory did not change from last year.)

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Answered: The December 31, 2019, balance sheet…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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The December 31, 2019, balance sheet for Walton Corporation is presented here. These are the only accounts on Walton’s balance sheet. Amounts indicated by question marks (?) can be calculated using the following additional information:

WALTON CORPORATION Balance Sheet As of December 31, 2019
Assets
Cash	$	35,000
Accounts receivable (net)		?
Inventory		?
Property, plant, and equipment (net)		305,000
	$	452,000
Liabilities and Stockholders’ Equity
Accounts payable (trade)	$	?
Income taxes payable (current)		35,000
Long-term debt		?
Common stock		311,000
Retained earnings		?
	$	?

Additional Information
Current ratio (at year end)	1.4 to 1.0
Total liabilities ÷ Total stockholders’ equity		60	%
Gross margin percentage		40	%
Inventory turnover (Cost of goods sold ÷ Ending inventory)		10.5	times
Gross margin for 2019	$	350,000

Required

Compute the balance in trade accounts payable as of December 31, 2019.
Compute the balance in retained earnings as of December 31, 2019.
Compute the balance in the inventory account as of December 31, 2019. (Assume that the level of inventory did not change from last year.)

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