Question

Decker Enterprises Below are the simplified current and projected financial statements for Decker Enterprises. All of Decker's assets are operating assets. All of Decker's current liabilities are operating liabilities. Income statement Current Projected Sales na          1,500 Costs na          1,050 Profit before tax na             450 Taxes na             135 Net income na             315 Dividends na                95 Balance sheets Current Projected Current Projected Current assets          100             115 Current liabilities           70               81 Net fixed assets      1,200          1,440 Long-term debt         300            360 Common stock         500            500 Retained earnings         430            650 If Decker had a financing deficit, it could remedy the situation by  

Answer 1

Income statement	Current	Projected
Sales	na	1,500
Costs	na	1,050
Profit before tax	na	450
Taxes	na	135
Net income	na	315
Dividends	na	95
Balance sheets	Current	Projected		Current	Projected
Current assets	100	115	Current liabilities	70	81
Net fixed assets	1,200	1,440	Long-term debt	300	360
			Common stock	500	500
			Retained earnings	430	650	Financing Surplus
		1555			1591	36
If Decker had a financing deficit, it could remedy the situation by
Borrowing on its line of credit, it can fill up its financing deficit.
Note: From the given information, Decker has Financing surplus, which can be remedy by
paying a special dividend.