Question
Fuzzy Button Clothing Company Balance Sheet for Year Ending Dec. 31 (Millions of Dollars) 1. Fill in the (????) for Cash & Equivalents, Net Plant/Equip,
Fuzzy Button Clothing Company Balance Sheet for Year Ending Dec. 31 (Millions of Dollars)
1. Fill in the (????) for Cash & Equivalents, Net Plant/Equip, Total Current Liabilities & Retained Earnings on the Balance Sheet
| Year 2 | Year 1 |
|
| Year 2 | Year 1 |
Assets |
|
|
| Liabilities & Equity |
|
|
Current assets |
|
|
| Current liabilities |
|
|
Cash & Equivalents | ???? | $2,029 |
| Accts payable | $0 | $0 |
Accounts Rec. | $928 | $743 |
| Accruals | $129 | $0 |
Inventories | $2,722 | $2,178 |
| Notes payable | $730 | $687 |
Total Current Assets | $6,187 | $4,950 |
| Total current liabilities | ???? | $687 |
Net Fixed Assets: |
|
|
| Long term debt | $2,578 | $2,063 |
Net Plant/Equip | ???? | $6,050 |
| Total debt | $3,474 | $2,750 |
|
|
|
| Common equity |
|
|
|
|
|
| Common stock | $6,703 | $5,363 |
|
|
|
| Retained earnings | ???? | $2,887 |
|
|
|
| Total common equity | $10,313 | $8,250 |
Total Assets | $13,750 | $11,000 |
| Total liabilities & equity | $13,750 | $11,000 |
Given the information in the balance sheet & assuming that the company has 50 million shares of common stock outstanding, read each of the following statements, then identify the selection the best interprets the information conveyed by the balance sheet. State whether the statement is true or false & pick the reason why between choices A - C for the following:
2. Fuzzy Button's accumulated owed financial obligations decreased from year 1 to year 2.
This statement is (TRUE/FALSE) because:
A. Accruals actually increased from $0 in year 1 to $129 million at the end of year 2
B. Long term debt decreased from $730 million at the end of year 1 to $687 million by the end of year 2
C. Notes payable actually increased from $730 million to $687 million between years 1 & 2
3. On Dec. 31 of year 2, Fuzzy Button Clothing Company had $2,537 million of actual money that it could have spent immediately.
This statement is (TRUE/FALSE) because:
A. The funds recorded in accounts receivable represents funds that are either cash or can be converted into cash almost immediately
B. Year 2 cash & equivalents balance is $6,385
C. The funds recorded in cash & equivalents accounts represents funds that are either cash or can be converted into cash almost immediately
4. The book value per share of stock in year 2 was $206.26.
This statement is (TRUE/FALSE) because:
A. The per share book value is calculated by dividing the company's total common equity by the number of outstanding shares of common stock
B. The per share book value is calculated by dividing the company's total debt by the number of outstanding shares of common stock
C. The per share book value is calculated by dividing the company's total assets by the number of outstanding shares of common stock
5. Which statement regarding the company's balance sheet is consistent with U.S. GAAP?
A. The company's assets should be listed in the order in which they are to be converted into cash
B. The company's assets should be listed from those carrying the largest balance to those with the smallest balance
C. The company's assets should be listed in alphabetical order
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started