Question

The company MONTES, SA is dedicated to the furniture marketing business, it has the following accounts for analysis: Real estate for $15,500, vehicles for $8,000, long-term debt for $9,100, suppliers for $8,500, short-term debt for $9,500. It has inventories of $7,500, capital for $7,500, reserves for $2,500, clients for $6,500 and cash of $1,100 (data worked in thousands). It is known that, in the last year, the company has credit sales of $5,200 and cash sales of $3,400. The company has sales costs of $2,700; variable expenses of $1,100 (data in thousands); and variable costs correspond to 20% of sales revenue. Based on the above, carry out the following activities: 1. Prepare the company's financial statement to be presented to the board of directors. 2. Determine the accounts and create the general balance sheet of the financial statements for the company. 3. Perform the financial analysis of the company for the current period.

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1. **Income Statement**:

- Calculate Total Revenue:

\$5,200,000 + \$3,400,000 = \$8,600,000

- Given Cost of Goods Sold (COGS):

\$2,700,000

- Calculate Variable Costs (20% of Revenue):

0.20 \times \$8,600,000 = \$1,720,000

- Calculate Gross Profit:

\$8,600,000 - \$2,700,000 - \$1,720,000 = \$4,180,000

- Given Variable Expenses:

\$1,100,000

- Calculate Net Income:

\$4,180,000 - \$1,100,000 = \$3,080,000

2. **Balance Sheet**:

- **Assets**:

- Real Estate:

\$15,500

- Vehicles:

\$8,000

- Inventories:

\$7,500

- Clients:

\$6,500

- Cash:

\$1,100

- Total Assets:

15,500 + 8,000 + 7,500 + 6,500 + 1,100 = 33,100

- **Liabilities**:

- Long-term Debt:

\$9,100

- Suppliers:

\$8,500

- Short-term Debt:

\$9,500

- Total Liabilities:

9,100 + 8,500 + 9,500 = 27,100

- **Equity**:

- Capital:

\$7,500

- Reserves:

\$2,500

- Total Equity:

7,500 - 2,500 = 6,000

3. **Financial Analysis**:

- Calculate Current Ratio:

\frac{15,100}{19,100} = 0.80

- Calculate Quick Ratio (excluding inventories):

\frac{15,100 - 7,500}{19,100} = 0.54

- Calculate Debt to Equity Ratio:

\frac{27,100}{6,000} = 4.52

- Calculate Return on Equity (using net income and equity):

\frac{\$3,080,000}{6,000} \times 100 = 51.33\%

- Calculate Total Revenue:

- Given Cost of Goods Sold (COGS):

- Calculate Variable Costs (20% of Revenue):

- Calculate Gross Profit:

- Given Variable Expenses:

- Calculate Net Income:

2. **Balance Sheet**:

- **Assets**:

- Real Estate:

- Vehicles:

- Inventories:

- Clients:

- Cash:

- Total Assets:

- **Liabilities**:

- Long-term Debt:

- Suppliers:

- Short-term Debt:

- Total Liabilities:

- **Equity**:

- Capital:

- Reserves:

- Total Equity:

3. **Financial Analysis**:

- Calculate Current Ratio:

- Calculate Quick Ratio (excluding inventories):

- Calculate Debt to Equity Ratio:

- Calculate Return on Equity (using net income and equity):

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