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Building a Balance Sheet Using Ratios

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Complete the balance sheet of Flying Roos Corporation. Please refer to the attached document.

Flying Roos Corporation
Balance Sheet as of December 31,2011
Assets:
Liabilities and Equity:
Cash and marketable securities
Accounts payable and accruals
Accounts receivable
Notes payable 300,000
Inventories
Total current assets
Total current liabilities

Long-term debt 2,000,000
Net plant and equipment
Common stock

Retained earnings $ 1,250,000
Total assets $ 8,000,000
Total liabilities and equity
You have the following information:
Debt ratio = 40.00%
DSO = 39 days
Current ratio = 1.5
Inventory turnover ratio = 3.375
Sales = $2,250,000
Cost of goods sold-$1.6875 million

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This solution illustrates how to build a balance sheet using common financial ratios and relationships.

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See Also This Related BrainMass Solution

I have the five ratios to conduct ratio analysis. I just need help to figure out whether to use common size income statements or regular income statements. And how to figure whether to use income statements for the analysis or the balance sheet. Balance sheet or trial balance.

The five ratios I will be using are:

current ratio
gross profit margin
Operating margin/ROS
Debt to equity
Inventory turnover

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