Comparative Financial Statements for Larson Company,prepared on December 31 Are

question 61

Essay

Comparative financial statements for Larson Company,prepared on December 31 are shown below:
$\begin{array}{l}\begin{array}{lll} \text {Income Statement}\\ \text {Sales revenue}\\ \text {Cost of goods sold}\\ \text {Gross profit}\\ \text {Operating expenses and interest expense}\\ \text {Pretax income}\\ \text {Income tax}\\ \text {Net income}\\\\ \text {Balance Sheet}\\ \text {Cash}\\ \text {Accounts receivable (net)}\\ \text {Inventoiy}\\ \text {Operational assets (net)}\\\\\text {Current liabilities (no interest)}\\\text {Long-term liabilities ( \( 10 \% \) interest)}\\\text {Common stock (par \$5)}\\\text {Retained earnings}\\\end{array}\begin{array}{lll}2012 \\\$ 190,000 \\\underline{112,000} \\ 78,000 \\\underline{56,000} \\22,000 \\\underline{8,000 }\\\underline{ 14.000}\\\\ \\\$ 4,000 \\14,000 \\40,000 \\\underline{45,000} \\ \underline{103,000} \\\$ 16,000 \\45,000 \\30,000 \\\underline{12,000} \\ \underline{103,000}\end{array}\begin{array}{lll}2011 \\\$ 167,000 \\\underline{100,000} \\67,000 \\\underline{53,000} \\14,000 \\\underline{4,000 }\\\underline{ 10,000 }\\\\ \\\$ 7,000 \\18,000 \\34,000 \\\underline{38,000} \\\underline{ 97,000}\\\$ 17,000 \\45,000 \\30,000 \\\underline{5,000} \\\underline{97,000}\end{array}\end{array}$
Required:
Assume that one-third of sales are on credit and that cash dividends of $3,000 were declared and paid in 2012.Then,complete a percentage change income statement and a percentage change balance sheet for the company,using both amount and percentage changes from 2011 to 2012.

---

Definitions:

The Board of Directors

A group of individuals elected by the shareholders of a corporation to oversee and make decisions on behalf of the corporation.

Partnership

An officially authorized business partnership in which two or more persons co-manage the operation and profit-sharing.

Limited Liability Company

In the United States, a company framework where the owners bear no personal responsibility for the firm's financial obligations or liabilities.

General Partnership

A partnership in which the partners divide profits and management responsibility and share unlimited personal liability for the partnership’s debts.