PROBLEM 8. Following is the Balance Sheet of D Company on December 31, 2008: D COMPANY-BALANCE SHEET as on 31st December, 2008 Liabilities 3 Assets Equity shares of 10 each 10,000 Fixed Assets 1,10,000 Additional Money Received Accumulated Depreciation 30,000 on Shares 30,000 80,000 Retained Earnings 13,250 Accounts Receivable 3,000 Bonds 30,000 Inventories 11,000 Accounts Payable 11.580 Prepaid Expenses 230 Cash 600 94,830 94,830 The Company did not buy or sell any fixed assets nor issued any shares during 2009. On December 31, 2009, the Company's Accountant obtained the following ratios and other data based on the 2009 operations : Current ratio 2.0 times Acid-test ratio Turnover of average inventory 0.8 times 5.0 times Turnover of average receivables 25.0 times 58.8% Equity ratio Debt ratio 41.2% Times interest earned 6.0 times Percentage of profit after/tax on sales 7.0% Gross margin percentage 52.0% Book value per share *58.80 Market value per share 764.00 Earnings per share * 8.75 Dividend yield 5.0% Corporate income tax rate 30% Depreciation rate 4% on original cost Required : Use the above data to prepare the Company's Balance Sheet on December 31, 2009 and Income Statement for the year ending on December 31, 2009. Assume all the sales have been made on credit basis, dividends have been paid off and all debts are on long-term basis