Problem:
Assets February 28 January 31
Cash $42,000 $37,000
Accounts receivable 64,000 53,000
Merchandise Inventory 81,000 94,000
Total current assets $187,000 $184,000
Plant and equipment:
Production equipment 166,000 152,000
Less: Accumulated depreciation (24,000) (21,000)
Total assets 329,000 315,000
Liabilities
Short-term debt 44,000 44,000
Accounts payable 37,000 41,000
Other accrued liabilities 21,000 24,000
Total current liablities 102,000 109,000
Long term debt 33,000 46,000
Total liabilities $135,000 155,000
Owner's Equity
Common stock,no par value 40,000
shares authorized, 30,000 and 28,000
shares issued, respectively $104,000 96,000
Retained earnings
Beginning balance 64,000 43,000
Net income for month 36,000 29,000
Dividends (10,000) (8,000)
Ending balance $90,000 $64,000
Total owner's equity $194,000 $160,000
Total liablities and owoner's equity $329,000 $315,000