Presented below are condensed data from the financial statements of Gallo Factory for 2017 and 2016.The figures are expressed in thousands.Use this information to answer the questions that follow.
Statement A Total current assets Property, plant, and equipment (net of accumulated depreciation) Investments Other assets Total assets Total current liabilities Long-term debt Deferred income taxes and contingencies Total liabilities Total stockholders’ equity Total liabilities and stockhol ders’ equity Statement B Net sales Cost of sales Gross profit Selling, general, and administrative expenses Other income (expense) Income (loss) before income taxes Income tax expense Net income (loss) 2017$82,30963,4513033,438$149,501$33,92820,4914,174$58,593$90,908$149,5012017$209,203136,225$72,97863,895693$9,776$3,5346,2422016$80,08062,7241,0612,606$146,471$28,66825,6765,208$59,552$86,919$146,4712016$174,206114,284$59,92253,520(118)$6,284$3,388$3,896
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Required: How much of Gallo Factory is financed by creditors at the end of December 2017? Evaluate the change from 2016 to 2017.
Definitions:
Market-Price Transfer
The practice of setting the price for goods or services sold between divisions within the same company based on the current market price.
Variable Cost
Costs that vary directly with the level of production or sales volume.
External Suppliers
Third-party entities that provide goods or services to a company, but are not part of the company itself.
Annual Capacity
The total output a company can produce in a year using its resources efficiently.