Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. wildhorse aristocrat nc.(wa) borrowed $210,000 fro

Wildhorse Aristocrat nc.(WA) borrowed $210,000 from Grow Business Bank to finance the purchase of equipment...

60.1K

Verified Solution

Question

Accounting

Wildhorse Aristocrat nc.(WA) borrowed $210,000 from Grow Business Bank to finance the purchase of equipment costing $157,500
and to provide $52,500 in cash. The legal documentation states that the loan matures in 20 years, and the principal is to be paid in
annual instalments of $10,500. The terms of the loan also indicate that WA must maintain a current ratio of 1.25 and cannot pay
dividends that will reduce retained earnings below $105,000. The 2024 year-end statement of financial position, immediately prior to
the bank loan and the purchase of equipment, follows:
Prepare the following statement of financial position assuming the maximum divided is declared and paid.
Current Assets
Non-current Assets
Total Assets
$
$
Current Liabilities
Long-term Liabilities
Common Shares
Retained Earnings
Total Liabilities and Shareholder's Equity
$
$
Calculate the current ratio using the updated statement of financial position. (Round answer to 2 decimal places, e.g.7.25.)
Current ratio
image

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Zin AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

ght triangle Round your answers to the nearest tenth a b 27 47 B a...

Basic Math
Q

prove the Liouville's theorem?

Physics
Q

THE AD If current through 402 is 2A then calcu potential difference across A B...

Physics
Q

10 What is the x intercept of the line with the equation 4x 2y 12...

Basic Math
Q

Consider the function below.f(x) = -3x + 6x + 6Exercise (a)Find the critical numbers of...

Calculus
Q

Which of the following accounts is not closed to the income summary account? A Salary...

Accounting
Q

Psi Company produces two products: TB12 and MJ23. Budgeted sales for four months are as...

Accounting
Q

Problem 12-25 (Static) CVP analysis-what-if questions; breakeven LO 12-7, 12-8, 12-9, 12-10 [The following information...

Accounting
Q

The XYZ partnership has the following balance sheets: ...

Accounting
Q

Congress defines gross income as except as otherwise provided, gross income means all income from...

Accounting
Q

Lucla Company has set the following standard cost per unit for direct materials and direct...

Accounting
Q

Given the following tax structure: a. What is the minimum tax that Pedro should pay...

Accounting