E eBook 7. 8. 3. 10 11. 2.5.1 Tarheet Furniture Company is planning to establish a wholly owned subsidiary to manufacture upholstery fabrics. Tarheel expects to earn $1.1 milions after taxes on the venture during the first year. The president of Tarheel wants to know what the subsidiary's balance sheet would look like. The president believes that it would be advisable to begin the new venture with ratios that are similar to the industry average, Tarheel plans to make all sales on credit. All calculations assume a 365-day year. Industry Averages Current ratio Quick ratio 1,2:1 Net profit margin ratio 594 Average collection period 25 days Debt ratio 429 Total asset tumover ratio 2 times Current liabilities/stockholders equity 25% 12 o 13. 14 15 16 17. Based upon the industry average financial ratios presented above, complete the projected balance sheet for Tarheel's upholstery subsidiary In your computations, you should round will numbers to the nearest $1,000 19 Forecasted Upholstery Subsidiary Balance Sheet Forecasted Upholstery Subsidiary Balance Sheet $ Total current liabilities Cash 5 Accounts receivable Long-term debt Total debt Inventory $ Total current assets Stockholders' equity Net fixed assets Total liabilities and stockholders equity Total assets $