-Please refer to the pro forma financial statements for Royal Corporation above.Assume that net fixed assets are projected to be 5,000 for 2014 and that shareholders' equity is projected to be 5,500 for 2014.If long-term debt is the plug figure,what should be the projection for long-term debt for Royal Corporation in 2014?
A) $2,206
B) $2,363
C) $2,455
D) $2,847

Question

-Please refer to the pro forma financial statements for Royal Corporation above.Assume that net fixed assets are projected to be 5,000 for 2014 and that shareholders' equity is projected to be 5,500 for 2014.If long-term debt is the plug figure,what should be the projection for long-term debt for Royal Corporation in 2014?
A) $2,206 
B) $2,363 
C) $2,455 
D) $2,847

Quizplus · Accepted Answer

Total assets would be 1,046 + 6,233 + 4,660 + 5,000 = $16,939
Total liabilities and equity,without long-term debt,would be 431 + 8,161 + 5,500 = $14,092
Long-term debt must make up the difference = 16,939 - 14,092 = $2,847

-Please Refer to the Pro Forma Financial Statements for Royal