Exhibit 1 Florence Farm, Inc. has total assets of $15.4 million of which $6.2 million are current...

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Exhibit 1 FlorenceFarm, Inc. has total assets of $15.4 million of which $6.2 millionare current assets. Cash makes up 18 percent of the current assetsand accounts receivable makes up another 40 percent of currentassets. Florence Farm’s gross plant and equipment has an originalcost of $10.35 million and other long-term assets have a cost valueof $1.5 million.
Use Exhibit 1. What isthe balance of inventory on Florence Farm’s balance sheet?
A. less than $2.40million
B. more than $2.40million but less than $2.48 million
C. more than $2.48million but less than $2.56 million
D. more than $2.56million but less than $2.64 million
E. more than $2.64million
Use Exhibit 1. What isthe balance of depreciation on Florence Farm’s balance sheet?
A. less than $2.35million
B. more than $2.35million but less than $2.60 million
C. more than $2.60million but less than $2.85 million
D. more than $2.85million but less than $3.10 million
E. more than $3.10million
Garden Fences, Inc.began the year 2017 with $12.5 million in retained earnings.Although the firm suffered a net loss of $2.4 million in 2017 itpaid $1.2 million to its preferred stockholders. If the year-end2017 balance in retained earnings for Garden Fences is $8.45million, how much did the firm pay out in dividends to its commonstockholders? A. less than $470,000
B. more than $470,000but less than $525,000
C. more than $525,000but less than $580,000 D. more than $580,000 but less than$635,000
E. more than$635,000
4. Strongest Gates, Inc. balance sheet for year-end 2016 listscurrent assets of $245,000, fixed assets of $875,000, currentliabilities of $135,000, and long-term debt of $395,000. Calculatethe firm’s total stockholders' equity for the end of year 2016.
A. less than$450,000
B. more than $450,000but less than $495,000
C. more than $495,000but less than $540,000
D. more than $540,000but less than $585,000
E. more than$585,000

Answer & Explanation Solved by verified expert

4.2 Ratings (793 Votes)


A	Total Current Assets	$6,200,000
B=18%*A	Cash	$1,116,000
C=40%*A	Accounts Receivable	$2,480,000
D=A-B-C	Balance of Inventory	$2,604,000
	ANSWER:D


A	Total Assets	$15,400,000
B	Total Current Assets	$6,200,000
C=A-B	Total Long Term Assets	$9,200,000
D	Other Long Term Assets	$1,500,000
E=C-D	Net Plant & equipment	$7,700,000
F	Gross Plant & equipment(at cost)	$10,350,000
G=F-E	Accumulated Depreciation	$2,650,000
	ANSWER:E


A	Beginning of 2017 Retained Earnings	$12,500,000
B	Net Loss	($2,400,000)
C=A+B	Retained Earnings before dividends	$10,100,000
D	Dividend to preferred shareholders	$1,200,000
E=C-D	Balance Retained Earnings	$8,900,000
F	End of year 2017 Retained Earnings	$8,450,000
G=E-F	Dividend payout to common shareholders	$450,000
	ANSWER: A

	Total Assets=Total Liabilities+ Total Shareholders' Equity
A	Current Assets	$245,000
B	Fixed Assets	$875,000
C=A+B	Total Assets	$1,120,000
D	Current Liabilities	$135,000
E	Long term debt	$395,000
F=D+E	Total Liabilities	$530,000
G=C-F	Total Stockholders'Equity	$590,000
	ANSWER:E

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Exhibit 1 FlorenceFarm, Inc. has total assets of $15.4 million of which $6.2 millionare current assets. Cash makes up 18 percent of the current assetsand accounts receivable makes up another 40 percent of currentassets. Florence Farm’s gross plant and equipment has an originalcost of $10.35 million and other long-term assets have a cost valueof $1.5 million.Use Exhibit 1. What isthe balance of inventory on Florence Farm’s balance sheet?A. less than $2.40millionB. more than $2.40million but less than $2.48 millionC. more than $2.48million but less than $2.56 millionD. more than $2.56million but less than $2.64 millionE. more than $2.64millionUse Exhibit 1. What isthe balance of depreciation on Florence Farm’s balance sheet?A. less than $2.35millionB. more than $2.35million but less than $2.60 millionC. more than $2.60million but less than $2.85 millionD. more than $2.85million but less than $3.10 millionE. more than $3.10millionGarden Fences, Inc.began the year 2017 with $12.5 million in retained earnings.Although the firm suffered a net loss of $2.4 million in 2017 itpaid $1.2 million to its preferred stockholders. If the year-end2017 balance in retained earnings for Garden Fences is $8.45million, how much did the firm pay out in dividends to its commonstockholders? A. less than $470,000B. more than $470,000but less than $525,000C. more than $525,000but less than $580,000 D. more than $580,000 but less than$635,000E. more than$635,0004. Strongest Gates, Inc. balance sheet for year-end 2016 listscurrent assets of $245,000, fixed assets of $875,000, currentliabilities of $135,000, and long-term debt of $395,000. Calculatethe firm’s total stockholders' equity for the end of year 2016.A. less than$450,000B. more than $450,000but less than $495,000C. more than $495,000but less than $540,000D. more than $540,000but less than $585,000E. more than$585,000