Take the following information on a company and say what assets the company has and where the money came from to own tho

[answerhappygod]

Take the following information on a company and say what assets
the company has and where the money came from to own those assets
(its liabilities and equity) at the end of two years of operation
(assume the principal repayment on debt has been made for year
2):
- The company has gross sales of $48 million per year, and the
pattern of sales is even, i.e., there is no cyclical pattern to
sales.
- Customers are large firms with a typical large-firm payment
pattern.
- COGS for business is 60% and is material only, all labor costs
are in SG&A.
- Monthly payroll is $200,000.
- There is enough raw material on hand to support one month of
manufacturing, and two months of actual production of finished
goods is in the warehouse (remember that finished goods is
inventory are carried on the books as COGS, not expected sale
price).
- The company pays its suppliers 30 days after goods are
received.
- The owners started the business with an initial capital
injection of $5.6 million 25 months ago.
- The company borrowed $3 million of long-term debt, with the
principal repayable in 10 equal annual payments.
- The company bought $8 million in assets at start up and picked
a depreciation period of 10 years. No additional assets have been
purchased.
- In the first two years of the business, the company had a
cumulative net income of $1,800,000 and paid dividends of $300,000
($150,000 per year) to the owners.
- The business has a short-term credit line that runs positive
or negative based on the fluctuations of the business 9just like a
personal checking account).
Prepare a balance sheet and use it to answer the following
questions:
1- What assets does the business have? Which is larger: current
assets or fixed?
2- How much short-term debt does the business have?
3- How much working capital does the business have?
4- If the cumulative dividend over two years had been $1,800,000
instead of $300,000 (if all the profits had been taken out of the
business as dividends), what would the short-term debt be? Would
working capital still be positive? 5- If you cut the inventory in
half by a vigorous program of “just in time” manufacturing and
shipping, by how much would your bank borrowings drop? Would
working capital change?