2018 Assets Cash... Marketable securities Accounts receivable Inventory.... Gross plant and equipment. less: accumulated amortization RYA COMPANY 2018 ce Sheet December 31, 2012 Liabilities and Shareholders' Equity $ 50,000 Accounts payable $2,200,000 80,000 Accrued expenses. 150,000 3,000,000 Notes payable (current)... 400,000 1,000,000 Bonds (10%).. 2,500,000 6,000,000 Common stock (1.7 million shares). 1,700,000 2,000,000 Retained earnings 1,180,000 Total liabilities and $8.130.000 shareholders' equity $8.130.000 Total assets Income Statement Year ended Dec. 31, 2012 Sales (credit) $7,000,000 Variable costs (0.60). 4,200,000 Contribution margin. 2,800,000 Fixed costs* 2,100,000 Operating profit. 700,000 Less: Interest. 250,000 Earnings before taxes 450,000 Less: Taxes @ 34%. 153,000 Earnings after taxes. $ 297,000 Deduct: Dividends. 118,800 Increased retained earnings $ 178,200 *Fixed costs include (a) lease expense of $200,000 and (b) amortization of $500,000 Note: Ryan Boot also has 566,000 per year in sinking fund obligations associated with its bond issue. The sinking fund represents an annual repayment of the principal amount of the bond. It is not tax deductible. 2018 Assets Cash... Marketable securities Accounts receivable Inventory.... Gross plant and equipment. less: accumulated amortization RYA COMPANY 2018 ce Sheet December 31, 2012 Liabilities and Shareholders' Equity $ 50,000 Accounts payable $2,200,000 80,000 Accrued expenses. 150,000 3,000,000 Notes payable (current)... 400,000 1,000,000 Bonds (10%).. 2,500,000 6,000,000 Common stock (1.7 million shares). 1,700,000 2,000,000 Retained earnings 1,180,000 Total liabilities and $8.130.000 shareholders' equity $8.130.000 Total assets Income Statement Year ended Dec. 31, 2012 Sales (credit) $7,000,000 Variable costs (0.60). 4,200,000 Contribution margin. 2,800,000 Fixed costs* 2,100,000 Operating profit. 700,000 Less: Interest. 250,000 Earnings before taxes 450,000 Less: Taxes @ 34%. 153,000 Earnings after taxes. $ 297,000 Deduct: Dividends. 118,800 Increased retained earnings $ 178,200 *Fixed costs include (a) lease expense of $200,000 and (b) amortization of $500,000 Note: Ryan Boot also has 566,000 per year in sinking fund obligations associated with its bond issue. The sinking fund represents an annual repayment of the principal amount of the bond. It is not tax deductible