Author Question: Below are the 2019 and 2020 year-end balance sheets for Wolken Enterprises:Assets:20202019Cash$ ... (Read 40 times)

agstelzer01 · **on:** Aug 7, 2023

Below are the 2019 and 2020 year-end balance sheets for Wolken Enterprises:

Assets:	2020	2019
Cash	$ 200,000	$ 170,000
Accounts receivable	864,000	700,000
Inventories	2,000,000	1,400,000
Total current assets	$3,064,000	$2,270,000
Net fixed assets	6,000,000	5,600,000
Total assets	$9,064,000	$7,870,000

Liabilities and equity:
Accounts payable	$ 1,400,000	$1,090,000
Notes payable	1,600,000	1,800,000
Total current liabilities	$3,000,000	$2,890,000
Long-term debt	2,400,000	2,400,000
Common shares	3,000,000	2,000,000
Retained earnings	664,000	580,000
Total common equity	$3,664,000	$2,580,000
Total liabilities and equity	$9,064,000	$7,870,000

Wolken has never paid a dividend on its common shares, and it issued $2,400,000 of 15-year non-callable, long-term debt in 2019. As of the end of 2020, none of the principal on this debt had been repaid. Assume that the company’s sales in 2019 and 2020 were the same. Which of the following statements must be correct?

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Wolken issued long-term debt in 2020.

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Wolken issued new common shares in 2020.

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Wolkenmade a lossin 2020.

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Wolken repurchased some common shares in 2020.

ellie · **Reply #1 on:** Aug 7, 2023

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