What does balance sheet look like at the end of the year

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You have a toy store. Your assets consist of $10,400 in inventory, $1,000 in equipment (phones, computers, etc.) and $600 cash. You are capitalized with $10,000 owners' equity and $2,000 debt at 6%. Assume your only variable cost are the bikes you purchase from the manufacturer, $60/bike. Your fixed costs total $2500.

Problem 1: During the year you purchased 240 bikes and sold them at $80/bike. But you only paid for half the bikes you bought, the rest were sold to you "on credit" (i.e., you'll pay later - next year). What is your ROE for this year? What does your balance sheet look like at the end of the year?

Reference no: EM133002644

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