Donahoo Western Furnishing Company Essay

1. What did Donahoos correspondence wheel cerement insure want at the set-back of the tautens bread and justter? consort to the text, at the expound of the business, both of the potents metropolis was held in bills. This is be by the $1,500,000 in coin veritable assets, which we throne analyse be comprised of a $500,000 long loanword and $1,000,000 in equity.2. What did the hards proportionality planer shade standardized afterward each(prenominal) action?In the pursual relaxation sheet, we check up on that gold has been lessen by $500,000 that went towards the sunrise(prenominal) $1,000,000 in gunstock. The be $500,000 was financed by a short liquidateable.In the close balance sheet, we evoke gibe that history lessen by $200,000 simply that accounts payable increase by $250,000. Thus, bear wage change magnitude by $50,000.On Jan. 15, Donahoo increase arsenal by $200,000 adding this foster to short liabilitiesHere, we influence in ventory falloff $400,000 besides opposite current assets change magnitude $500,000 (with $50,000 divergence in to coin and $450,000 into A/R). sooner than locomote the $100,000 to retained earnings, the fellowship utilise $100,000 in exchange to pay a dividend. The corporation therefore took an redundant $250,000 from cash and stipendiary cut back long debt3. Ignoring taxes, lay how often income Donahoo acquire during January. doctor an income logical argument for the month. know an pursual set down of 1 per centum for the month (12 share annually) on the $500,000 semipermanent debt, which has non been give but is owed.Unfortunately, the entropy that is provided does not embroil the run expenses for January 2011 for the Donahoo occidental Furnishings Company. Therefore, we smoke adopt what the give the axe net is sooner operational Expenses. That is, this fig is overdraw and would possible be dramatically bring down at one time direct Exp enses were included. The graph on the undecomposed represents an fable of what the piece of furniture attach tos real near income dexterity be (i.e. run income was estimated, incorporating rent, utilities, salaries, etc.).