Balance Sheet and Income Statement from ratios :

Financial statement construction via ratios. Incomplete financial statements of Lock Box, Inc

4.Financial statement construction via ratios.Incomplete financial statements of Lock Box, Inc., are presented below.

LOCK BOX, INC. Income Statement For the Year Ended December 31, 19X3
Sales	$ ?
Cost of goods sold	?
Gross profit	$15,000,000
Operating expenses & interest	?
Income before tax	$ ?
Income taxes, 40%	?
Net income	$ ?

LOCK BOX, INC.

Balance Sheet

December 31, 19X3

Assets

Cash

Accounts receivable

Inventory

Property, plant, &. equipment

Total assets

$ ?

8,000,000

$24,000,000

Liabilities & Stockholders’ Equity

Accounts payable

Notes payable (short-term)

Bonds payable

Common stock

Retained earnings

Total liabilities & stockholders’ equity

$ ?

600,000 4,600,000

2,000,000

$24,000,000

Further information:

1.Cost of goods sold is 60% of sales. All sales are on account.

2.The company’s beginning inventory is $5 million; inventory turnover is 4.

3.The debt to total assets ratio is 70%.

4.The profit margin on sales is 6%.

5.The firm’s accounts receivable turnover is 5. Receivables increased by $400,000 during the year.

Instructions:

Using the preceding data, complete the income statement and the balance sheet.

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