Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. wildhorse aristocrat nc.(wa) borrowed $210,000 fro

Wildhorse Aristocrat nc.(WA) borrowed $210,000 from Grow Business Bank to finance the purchase of equipment...

80.2K

Verified Solution

Question

Accounting

Wildhorse Aristocrat nc.(WA) borrowed $210,000 from Grow Business Bank to finance the purchase of equipment costing $157,500
and to provide $52,500 in cash. The legal documentation states that the loan matures in 20 years, and the principal is to be paid in
annual instalments of $10,500. The terms of the loan also indicate that WA must maintain a current ratio of 1.25 and cannot pay
dividends that will reduce retained earnings below $105,000. The 2024 year-end statement of financial position, immediately prior to
the bank loan and the purchase of equipment, follows:
Prepare the following statement of financial position assuming the maximum divided is declared and paid.
Current Assets
Non-current Assets
Total Assets
$
$
Current Liabilities
Long-term Liabilities
Common Shares
Retained Earnings
Total Liabilities and Shareholder's Equity
$
$
Calculate the current ratio using the updated statement of financial position. (Round answer to 2 decimal places, e.g.7.25.)
Current ratio
image

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Basic Math
1.2K views

nework aspx homeworkId 6438282 lex roots Write the answer in Questi

Biology
1.2K views

In Virginia water has eroded underground areas of limestone to form large 2 points caves...

Calculus
1.2K views

Question 6 The polynomial of degree 3 P x has a root of multiplicity 2...

Calculus
1.2K views

Solve the inequality Enter your answer using interval notation 1 7 1 X X 6...

Accounting
1.2K views

Flores Company publishes a monthly sports magazine, Hunting Preview. Subscriptions to the magazine cost \$25...

Accounting
1.2K views

Los estados financieros de Campbell, Inc. y Newton Company para el ao que termin el...

Accounting
1.2K views

Accounting Information Systems and Technology Introduction: Accounting Information Systems (AIS)...

Accounting
1.2K views

Please explain #7 Page 2 of 15ZOOM 2 7. Respass...

Accounting
1.2K views

Exercise 1010( Algo) Calculate retained earnings each year (LO10-5) In its first five years of...

Accounting
1.2K views

Calculate average cost per unit. (Round answer to 2 decimal places, 6.8. 276) Average cost...

Accounting
1.2K views

EX 2. Choose any five encumbrance transactions and complete the following ...

Finance
1.2K views

Question 5 4 pts Stability is a risk management goal a loss O before O...