Blockbuster is a video rental and retail chain.Blockbuster is forecasting its financial statements for Year 7.Selected financial information for Year 6 is provided in the table.What is long term debt (the plug variable)for the forecasted year? To forecast current liabilities payable use the percentage of sales method based on Year 6 figures.Assume that no dividends are paid in Year 7.
Selected Financial Information
Blockbuster Inc.($ '000)

Question

Quizplus · Accepted Answer

Calculate Current Liabilities as % of sales from Year 6 : 24.6006%
Current Liabilities = (5,673,360) × (0.246006) = 1,395,680
Long Term 11ea7fdb_fc46_1cc8_a768_39019466b2b0_TB2902_11 = Total Assets - Total Shareholders' Equity - Total Current Liabilities
Total Shareholder's 11ea7fdb_fc46_1cc9_a768_f55fe0d63178_TB2902_11 = Common 11ea7fdb_fc46_1cca_a768_d17c25118c4d_TB2902_11 + Retained 11ea7fdb_fc46_1ccb_a768_81513f498359_TB2902_11 Retained 11ea7fdb_fc46_43dc_a768_2dbeb5879ad6_TB2902_11 = Retained 11ea7fdb_fc46_43dd_a768_cd391e1d4e3f_TB2902_11 + Net 11ea7fdb_fc46_43de_a768_7faee03d5ce4_TB2902_11 - 11ea7fdb_fc46_43df_a768_7d380da928b2_TB2902_11 Retained 11ea7fdb_fc46_43e0_a768_cd60c36fecee_TB2902_11 = -327,100 + (-195,733) - 0 = $-522,833
Total Shareholder's 11ea7fdb_fc46_43e1_a768_fd46023dfb3b_TB2902_11 = 6,075,800 + (-522,833) = 5,552,967
Long Term 11ea7fdb_fc46_6af2_a768_113af1dbd699_TB2902_11 = $7,746,790 - $5,552,967 - $1,395,680 = $798,143

Blockbuster Is a Video Rental and Retail Chain