FIN400 Critical Thinking 4. Classified balance sheet

The following (given in scrambled order) are accounts and balances from the accounting records of Alleg, Inc., as of December 31, 2012, after the books were closed for the year.


Common stock, authorized 21,000 share

At $1 par value, issued 12,000 Shares

$12,000



Additional paid-in capital



38,000



Cash



14,000



Marketable securities



17,000



Accounts receivable



26,000



Accounts Payable



16,000



Current maturities of long-term debt



11,000



Mortgages payable



80,000



Bonds payable



65,000



Inventory



33,000



Land and buildings



57,000



Machinery and equipment



120,000



Goodwill



13,000



Patents



9,000



Other assets



45,000



Deferred income taxes (long-term liability)



18,000



Retained earnings



33,000



Accumulated depreciation



61,000



Bonds and mortgages generally have 10-30 years until maturity. Marketable securities are short-term investments that can be converted to cash in a matter of minutes.



Required:



Prepare a classified balance sheet with a proper heading on a spreadsheet. For assets, use the classifications of current assets, plant and equipment, intangibles, and other assets. For liabilities, use the classifications of current liabilities and long-term liabilities.

Compute the total asset turnover rate assuming that total revenues in 2012 were $682,500. Round to the nearest hundredth, e.g., 3.33.

Assume that Alleg’s primary competitor has an asset turnover of 2.12. What does this tell you about Alleg’s asset management?