Question
Groton Company Comparative Balance Sheet December 31, 2011 and 2010 2011 2010 Assets Cash $ 7 $ 18 Accounts receivable 346 257 Inventory 186 238
Groton Company Comparative Balance Sheet December 31, 2011 and 2010 | ||||
2011 | 2010 | |||
Assets | ||||
Cash | $ | 7 | $ | 18 |
Accounts receivable | 346 | 257 | ||
Inventory | 186 | 238 | ||
Prepaid expenses | 36 | 34 | ||
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Total current assets | 575 | 547 | ||
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Property, plant, and equipment | 537 | 458 | ||
Less accumulated depreciation | (83) | (69) | ||
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Net property, plant, and equipment | 454 | 389 | ||
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Long-term investments | 39 | 44 | ||
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Total assets | $ | 1,068 | $ | 980 |
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Liabilities and Stockholders' equity | ||||
Accounts payable | $ | 315 | $ | 239 |
Accrued liabilities | 84 | 94 | ||
Income taxes payable | 83 | 74 | ||
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Total current liabilities | 482 | 407 | ||
Bonds payable | 226 | 200 | ||
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Total liabilities | 708 | 607 | ||
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Common stock | 191 | 230 | ||
Retained earnings | 169 | 143 | ||
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Total stockholders equity | 360 | 373 | ||
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Total liabilities and stockholders' equity | $ | 1,068 | $ | 980 |
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Groton Company Income Statement For the Year Ended December 31, 2011 | ||||||||||||||||
Sales | $ | 741 | ||||||||||||||
Cost of goods sold | 444 | |||||||||||||||
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Gross margin | 297 | |||||||||||||||
Selling and administrative expenses | 199 | |||||||||||||||
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Net operating income | 98 | |||||||||||||||
Non operating items: | ||||||||||||||||
Gain on sale of investments | $ | 5 | ||||||||||||||
Loss on sale of equipment | (2) | 3 | ||||||||||||||
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Income before taxes | 101 | |||||||||||||||
Income taxes | 36 | |||||||||||||||
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Net income | $ | 65 | ||||||||||||||
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During 2011, Groton sold some equipment for $29 that had cost $41 and on which there was accumulated depreciation of $10. In addition, the company sold long-term investments for $10 that had cost $5 when purchased several years ago. A cash dividend was paid during 2011 and the company repurchased $39 of its own stock. Groton did not retire any bonds during 2011.
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