Question: complete a balance sheet on a separate page using the...
Complete a balance sheet on a separate page using the information below compiled by Rhonda on January 22, 2019.
Grain on hand
3500 bu. @ $5.00 per bu.
Hay on hand
100 tons @ $80.00 per ton
200 acres @ $69.80 per acre
Farm mortgage (due/4/1/19)
$10,000 accrued interest
balance after 4/01/19 payment $260,000
Buildings & improvements
Note payable on feeder cattle (all due 4/15/19)
Calves (to be sold in May 2019)
100 head @ $605 per head
Feeder cattle (to be sold in 60 days)
125 head @ $800 per head
Note payable at bank (all due 3/1/019)
Other machinery & equipment
Loan on beef cows (due 10/01/19)
$2,200 accrued interest
balance after 10/1/15 payment $34,000
Land (present market value)
1000 acres @ $1800 per acre
Beef breeding cows
110 head @ $1000 per head
4 head @ $2,200 each
Checking account balance
Account payable at Joe's Feed & Seed
Shop Equip. (welder, lathe, drill press, etc.)
100 shares @ $90 per share
Has paid in advance for $6,000 worth of feed in order to get a good price on it. The feed will be delivered in May, 2019.
2) Income and social security taxes on 2018 income (not yet paid) are estimated at $14,200.
3)Rhonda contributed $590,000 to get her business started.
4) Retained earnings since the beginning of the business equals $655,000.
What is Rhonda's owner's equity as of January 22, 2019?
How much working capital does Rhonda have?
What is her current ratio?
What is her debt/asset ratio?
What is her debt/equity ratio?
6. What is her equity/asset ratio?
Assume you are a financial consultant hired by Rhonda to analyze her financial
condition. Based on this balance sheet, what part of her financial condition is most in need of
What does this balance sheet tell you about the amount of profit Rhonda made in 2013?
Explain your answer.
Rhonda wants to borrow $40,000 from the bank to buy additional beef breeding cows.
They will cost $40,000. Assume the loan is made, the cows are purchased.
What will Rhonda's owner's equity be immediately after the transactions are
completed if there are no other changes on her balance sheet?
What will her debt/asset ratio be?
What will be her debt/equity ratio be?
If you were Larry Loanmaker, would you lend Rhonda the money? Why?