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1 . You are the new manager of the Duke Snider Motel. In order to better understand the motels financial situation, you decide to examine

1. You are the new manager of the Duke Snider Motel. In order to better understand the motels financial situation, you decide to examine the financial statements for the year just ended (20x4). The motels balance sheet and condensed income statement are as follows:Duke Snider MotelBalance SheetsDecember 31,20x4Assets Current assets:Cash$95,000Accounts receivable100,000Inventories5,000Total current assets200,000Property and equipment:Land60,000Building (net)300,000Furniture & Equipemnt (net)80,000Total property and Equipment440,000Total assets640,000Liabilities and owners equityCurrent liabilities210,000Long-term liabilities:Note from owner40,000Mortgage payable80,000Total liabilities330,000Owners equityCommon stock100,000Retained earnings210,000Total owners equity310,000Total liabilities and owners equity640,000Duke Snider MotelCondensed Income StatementFor the year ended December 31,20x4Sales$1,500,000Cost of goods sold200,000Operating expenses800,000Contribution margin500,000Undistributed operating expenses125,000Gross operating profit375,000Interest120,000Other non-operating expenses162,000Income before taxes93,000Income tax27,900Nit income 65,100

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