Reference no: EM132774142

Problem 1: American Bacon Inc. financial statements are presented in the table below. Based on the information in the table, and using a 365-day year, calculate Average Day's Purchases.

Round the answers to two decimal places

Balance Sheet December 31, 2010

Cash and marketable securities: $102,000

Accounts payable: $287,000

Accounts receivable: $299,000

Notes payable: $61,200

Inventories: $628,000

Accrued expenses: $51,900

Prepaid expenses: $10,300

Total current liabilities: $400,100

Total current assets: $1,039,300

Long-term debt: $415,000

Gross fixed assets: $1,502,000

Par value and paid-in-capital: $376,000

Less: accumulated depreciation: $312,000

Retained Earnings: $1,038,200

Net fixed assets: $1,190,000

Common Equity: 1,414,200

Total assets: $2,229,300

Total liabilities and owner's equity: $2,229,300

Income Statement, Year of 2010

Net sales (all credit): $6,387,700.00

Less: Cost of goods sold: $4,726,898.00

Selling and administrative expenses: $345,000.00

Depreciation expense: $148,000.00

EBIT: $1,167,802.00

Interest expense: $50,600.00

Earnings before taxes: $1,117,202.00

Income taxes: $446,880.80

Net income: $670,321.20