BALANCE SHEET The assets of Dallas & Associates consist entriely of current assets and net plant and equipment. The firm has total assets of $25 million and net plant and equipment equals $2 million. It has notes payable of $150.000, long-term debt of $750,000, and total common equity of $15 million. The firm does have accounts payable and accruals on its balance sheet the firm only finances with debt and common equity, so it has no preferred stock on its balance sheet.

1. a. What is the company’s total debt?
2. b. What is the amount of total liabilities and equity that appears on the firm’s balance sheet?
3. c. What is the balance of current assets on the firm’s balance sheet?
4. d. What is the balance of current liabilities on the firm’s balance sheet?
5. e. What is the amount of accounts payable and accruals on its balance sheet? (Him: Consider this as a single line item on the firm’s balance sheet.)
6. f. What is the firm’s net working capital?
7. g. What is the firm’s net operating working capital?
8. h. What is the explanation for the difference in your answers to parts f and g?

To compute: The total debt of Company D.

Balance sheet: Balance sheet is a part of the financial statements that lists the company’s assets, liabilities and shareholders’ fund. It is prepared at the closure of the accounting period and informs about the company’s financial position on that day.

Given,

Long-term debt is $750,000.

Notes payable is $150,000.

Formula to compute total debt,

Total Debt=Long-term Debt+Notes Payable

Substitute $750,000 for long term debt and $150,000 for notes payable

To compute: The amount of total liabilities and equity of Company D.

Balance sheet: Balance sheet is a part of the financial statements that lists the company’s assets, liabilities and shareholders’ fund. It is prepared at the closure of the accounting period and informs about the company’s financial position on that day.

To compute: The current assets of Company D.

Balance sheet: Balance sheet is a part of the financial statements that lists the company’s assets, liabilities and shareholders’ fund. It is prepared at the closure of the accounting period and informs about the company’s financial position on that day.

To compute: The current liabilities of Company D.

Balance sheet: Balance sheet is a part of the financial statements that lists the company’s assets, liabilities and shareholders’ fund. It is prepared at the closure of the accounting period and informs about the company’s financial position on that day.

To compute: The amount of accounts payable and accruals of Company D.

Balance sheet: Balance sheet is a part of the financial statements that lists the company’s assets, liabilities and shareholders’ fund. It is prepared at the closure of the accounting period and informs about the company’s financial position on that day.

To compute: The net working capital of Company D.

Balance sheet: Balance sheet is a part of the financial statements that lists the company’s assets, liabilities and shareholders’ fund. It is prepared at the closure of the accounting period and informs about the company’s financial position on that day.

To compute: The net operating working capital of Company D.

Balance sheet: Balance sheet is a part of the financial statements that lists the company’s assets, liabilities and shareholders’ fund. It is prepared at the closure of the accounting period and informs about the company’s financial position on that day.

To explain: The difference in net working capital and net operating working capital of Company D.

Balance sheet: Balance sheet is a part of the financial statements that lists the company’s assets, liabilities and shareholders’ fund. It is prepared at the closure of the accounting period and informs about the company’s financial position on that day.