chapter 3 hw.docx - Construct a balance sheet for Sophie's...

Construct a balance sheet for Sophie's Sofas given the following data, including shareholders' equity.
Cash balances = $ 9,500
Inventory of
sofas
= $195,000
Store and
property
= $ 95,000
Accounts
receivable
= $ 21,500
Accounts payable = $ 16,500
Long-term debt = $165,000
Answer is complete and correct.
BALANCE SHEET OF SOPHIE'S SOFAS
Assets Liabilities & Shareholders' Equity
Cashselected answer correct
$9,500selected answer
correct
Accounts payableselected
answer correct
$16,500selected answer
correct
Accounts receivableselected
answer correct
21,500selected answer
correct
Long-term debtselected answer
correct
165,000selected answer
correct
Inventoryselected answer
correct
195,000selected answer
correct
Shareholders' equityselected
answer correct
139,500selected answer
correct
Store and propertyselected
answer correct
95,000selected answer
correct
not attempted not attempted
not attempted not attempted not attempted not attempted
Total assets $321,000
Total liabilities & shareholders'
equity
$321,000

A firm’s income statement included the following data. The firm’s average tax rate was 25%.
Cost of goods sold $9,500
Income taxes paid $3,500
Administrative
expenses
$4,500
Interest expense $2,500
Depreciation $2,500
a. What was the firm’s net income?
b. What must have been the firm's revenues?
c. What was EBIT?
Explanation