balance sheet shown below, and that sales for the year just ended were $4.2 million. The firm also has a profit margin of 25 percent, a retention ratio of 30 percent, and expects sales of $7.2 million next year.

Assets

Current assets $ 1,974,000 Assets Liabilities and Equity

Fixed assets 3,600,000 Current liabilities $ 1,512,000

Long-term debt 1,900,000

Equity 2,162,000

Total assets $ 5,574,000 Total liabilities and Total assets $ 5,574,000