BUS 616 Summer 2015 Quiz #2 Given below are balance sheets

| June 7, 2016

Question
BUS 616
Summer 2015
Quiz #2
Given below are balance sheets for Vernon’s Shoppe, Inc. for a three year period, plus some additional information.
Required:

1) on this tab, compute the rates of change for each balance sheet account for 20×2 and 20×3 (MUST SHOW FORMULA)
2) on the second tab, compute the ratios specified (make sure your Calculations/Formulas can be clearly followed), and provide in-depth analysis with Chart
Vernon’s Shoppe, Inc.
Balance Sheets
As of December 31, 20×3, 20×2, and 20×1
20×3
Assets
Cash
Accounts receivable (net)
Inventory
Prepaid expenses

20×2

Total Current Assets

735,218

707,522

656,419

Total Assets

1,569,833

1,378,007

1,327,022

Total Current Liabilities

396,310
275,381
671,691

321,517
260,049
581,566

300,567
243,812
544,379

Long Term Notes Payable

350,000

300,000

300,000

10,000
538,142

10,000
486,441

10,000
472,643

Total Liabilities and Owner Equity

1,569,833

1,378,007

1,327,022

Sales (from Income Statement)

1,808,422

1,631,509

1,521,344

Plant and Equipment (net)

48,369
318,275
286,311
17,530
670,485

20×1

10,821
342,660
443,528
37,606
834,615

57,263
341,512
256,400
15,428
670,603

Liabilities and Owner Equity
Liabilities
Accounts payable
Accrued expenses

Common Stock
Retained Earnings

Also note:
Gross margin remains constant at 40% of sales each year
Allowance for bad debts is $20,000 each year

Compute and GRAPH the following:

Day

Provide a brief in-depth assessment of the company’s liquidity position, including trends
Limit your answer to about Ten lines that fit on the screen.

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