1 / 241

ACCT 503 Inspiring Communication / snaptutorial.com

Question 1. Question : (TCO 3) The Mixing Department is the third department in the MZS Inc. factory. During January, there were 4,000 units of beginning inventory in the Mixing Department, and 80,000 units were transferred in from the prior process. There were 8,000 units in ending inventory. The transferred-in cost in the beginning inventory

Radisongeorgeesuw
Download Presentation

ACCT 503 Inspiring Communication / snaptutorial.com

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. ACCT 503 Case Study 1 (Gordon Construction) For more classes visit www.snaptutorial.com Case Study 1 (Part A) Analyze the impact of business transactions on accounts; record (journalize and post) transactions in the books; construct and use a trial balance) During the first month of operation of Gordon Construction, Inc., completed the following transactions: June 2 Gordon received $55,000 cash and issued common stock to the stockholders. 3 Purchased supplies, $3,000, and equipment, $5,200, on account. 4 Performed services for a client and received cash, $6,300. 7 Paid cash to acquire land, $37,000.

  2. 11 Performed services for a customer and billed the customer, $1,200. Johnson expects to collect within one month. 16 Paid partial for the equipment purchased June 3 on account $2,800. 17 Paid the telephone bill, $230. 18 Received partial payment from customer on account, $700. 22 Paid the water and electricity bills, $400. 29 Received $5,000 cash for repairing the pipes of a customer. 30 Paid employee salary, $4,300. 30 Declared and paid dividends of $3,000. ▸Requirements • 1. Record each transaction in the journal. Key each transaction by date. Explanations are not required. • 2. Post the transactions to the T-accounts, using transaction dates as posting references. • 3. Prepare the trial balance of Gordon Construction, Inc., at June30, 2014. • 4. The manager asks you how much in total resources the business has to work with and, how much it owes. Adjust the accounts; construct the financial statements) Record the following month end adjusting entries for Gordon Construction, Inc. at June 30, 2014 Month end accruals at June 30, 2014:

  3. • a. Accrued advertising revenue at June 30, $3,100. • b. Supplies used during June, $3,090. • c. Accrued salary expense at June 30 for Monday, Tuesday, and Wednesday. The five-day weekly payroll is $6,100 and will be paid on Friday. Requirement 2 Prepare adjusted trial balance for Gordon Construction at June 30, 2014. ***************************************************************************** ACCT 503 Case Study 2 (Williams Oil) For more classes visit www.snaptutorial.com Case study

  4. (Learning Objectives 2, 4: Explain the components of internal control; evaluate internal controls) Each of the following situations reveals an internal control weakness: Situation a. In evaluating the internal control over inventory for the Williams Oil Services Company, an auditor learns that the warehouse receiving clerk is responsible for ordering parts for supply inventory use in drilling services, counts the inventory when received at the dock, records the receipts into the inventory ledger, and takes the annual inventory, No supervisor reviews the receiving clerks work. Situation b. Nicole Lopez handles employee travel and expense reports for Scott Sales Services. With the growth in the economy, the sales team began traveling extensively gaining new business. Because of the heavy volume, she no longer required the sales team to provide original airline, hotel, or car rental receipts. She told them to just keep their meals under the $100 per day per diem and no receipts were required. She allowed them to use their own credit cards so they could get the frequent flyer points. She required them to turn in a summary of the travel expenses quarterly. Situation c. Michael Jordon is a new employee hired from Craigs List recommended by a co-worker. Mike was hired as a Human Resource Assistant. Mikes first day on the job he is told that he should follow his own judgments when deciding how employee issues such as hiring and firing of employees, sexual harassment, and ethical infractions should be handled.

  5. Top of Form ? Requirements 1. Identify the missing internal control characteristic in each situation. 2. Identify each firms possible problem. 3. Propose a solution to the problem. ***************************************************************************** ACCT 503 Case Study 3 (Wang Appliance Store) For more classes visit

  6. www.snaptutorial.com Construct and use a cash budget) Nathan Farmer, chief financial officer of Wang Appliance Store, is responsible for the company?s budgeting process. Farmer?s staff is preparing the Wang cash budget for 2014. A key input to the budgeting process is last year?s statement of cash flows, which follows (amounts in thousands): Wang Appliance Store Statement of Cash Flows 2013 (in thousands) Cash Flows from Operating Activities Collections from customers $51,000 Interest Received 500 Purchase of inventory (36,000)

  7. Operating expenses (10,200) Net cash provided by operating activities 5,300 Cash Flows from Investing Activities Purchase of equipment (3,500) Purchase of investments (500) Sale of investments 1,000 Net cash used for investing (3,000 ) activities Cash Flows from Financing Activities

  8. Payment of long term debt (400) Issuance of Stock 2,000 Payment of cash dividends (500) Net cash provided by financing 1,000 activities Cash Increase (decrease) in Cash 3,300 Cash, beginning of year 2,900 Cash, end of year 5,900 ? Requirements

  9. 1. Prepare the Wang cash budget for 2014. Date the budget simply ?2014? and denote the beginning and ending cash balances as ?beginning? and ?ending.? Assume the company expects 2014 to be the same as 2013, but with the following changes: a. In 2014, the company expects a 20% increase in collections from customers and a 30% increase in purchases of inventory. b. There will be no sales of investments in 2014. c. Wang does not plan to issue stock in 2014. d. Wang plans to end the year with a cash balance of $5,550. ***************************************************************************** ACCT 503 Course Project Analysis of Nike, Inc. and Under Armour, Inc.

  10. For more classes visit www.snaptutorial.com Course Project: A Financial Statement Analysis A Comparative Analysis of Nike, Inc. and Under Armour, Inc. Below is the link for the financial statements for Nike, Inc. for the fiscal year ending 2014. First, select 2014using the drop-down arrow labeled Year, and then select Annual Filings using the drop-down arrow labeled All. You should select the 10k dated 7/15/2014,and choose to download in PDF, Word, or Excel format. http://investors.nike.com/investors/news-events-and- reports/?toggle=filings

  11. Below is the link for the financial statements for Under Armour, Inc. for the fiscal year ending 2014. First, select Annual using the drop-down arrow labeled View, and then select 2015 using the drop-down arrow labeled Year. You should select the 10k dated 2/20/2015, and choose to download it in PDF or Excel format. http://www.uabiz.com/sec.cfm A sample project template is available for download from the Course Resources page’s Course-Specific Resources section.The sample project compares the ratio performance of Tootsie Roll and Hershey using the

  12. 2014 financial statements of Tootsie Roll and Hershey provided at their websites. Description This course contains a Course Project, where you will be required to submit one draft of the project at the end of Week 5, and the final completed project at the end of Week 7. Using the financial statements for Nike, Inc. and Under Armour, Inc.,respectively, you will calculate and compare the financial ratios listed further down this documentfor the fiscal year ending 2014, and prepare your comments about the two companies’performancesbased on your ratio calculations. The entire project will be graded by the instructor at the end of the final submission in Week 7, and one grade will be assigned for the entire project.

  13. Overall Requirements For the Final Submission: Your final Excel workbook submission should contain the following. You cannot use any other software but Excel to complete this project. A Completed Worksheet Title Page tab, which is really a cover sheet with your name, the course, the date, your instructor’s name, and the title for the project. 1. A CompletedWorksheetProfiles tab which contains a one- paragraph description regarding each company with information about their history, what products they sell, where they are located,and so forth. 2. All 16 ratios for each company with the supporting calculations and commentary on your Worksheet Ratio tab. Supporting calculations must be shown either as a formula or as text typed into a different cell.The ratios are listed further down this document. Your comments for each ratio should include more than just a definition of the ratio.You should focus on interpreting each ratio number for each 3.

  14. company and support your comments with the numbers found in the ratios.You need to specifically state which company performed better for each ratio. The Summary and ConclusionsWorksheet tab is an overall comparison of how each company compares in terms of the major category of ratios described in Chapter 13 of your textbook.A nice way to conclude is to state which company you think is the better investment and why. 4. The Bibliography Worksheet tab must contain at least your textbook as a reference. Any other information that you use to profile the companies should also be cited as a reference. 5. Required Ratios for Final Project Submission 1. Earnings per Share of Common Stock 2. Current Ratio 3. Gross (Profit) MarginPercentage 4. Rate of Return (Net Profit Margin) on Sales 5. Inventory Turnover

  15. 6. Days’ Inventory Outstanding (DIO) 7. Accounts Receivable Turnover 8. Days’ Sales Outstanding (DSO) 9. AssetTurnover 10. Rate of Return on Total Assets (ROA) 11. Debt Ratio 12. Times-Interest-Earned Ratio Dividend Yield[For the purposes of this ratio, use Yahoo Finance to look up current dividend per share and stock price; just note the date that you looked up this information.] 13. 14. Rate of Return on Common Stockholders’ Equity (ROE) 15. Free cash flow

  16. Price-Earnings Ratio (Multiple) [For the purpose of this ratio, for Nike, use the market price per share on May 30, 2014,and for Under Armour, use the market price per share on December 31, 2014.] 16. The Excel files uploaded in the Dropboxes should not include any unnecessary numbers or information (such as previous years' ratios, ratios that were not specifically asked for in the project, etc.). ***************************************************************************** ACCT 503 Course Project Oracle and Microsoft Corporation For more classes visit www.snaptutorial.com

  17. Course Project Financial Statement Analysis Project -- A Comparative Analysis of Oracle Corporation and Microsoft Corporation Here is the link for the financial statements for Oracle Corporation for the fiscal year ending 2007. First, select 2007 using the drop-down arrow labeled for Year on the right-hand side of the page, and then select Annual Reports using the drop-down arrow labeled Filing Type on the left-hand side of the page. You should select the 10k dated 6/29/2007 and choose to download in PDF, Word, or Excel format. http://www.oracle.com/us/corporate/investor-relations/sec/index.html Here is the link for the financial statements for Microsoft Corporation for the fiscal year ending 2007. You should select the Annual report dated 8/3/2007 and choose to download in Word or Excel format. http://www.microsoft.com/investor/SEC/default.aspx?year=2007 A sample Project template is available for download in Doc Sharing. The sample project compares the ratio performance of Tootsie Roll and Hershey using the 2007 financial statements of Tootsie Roll and Hershey provided in Appendix A and Appendix B of your textbook.

  18. Description | Overall Requirements | Grade Information Description This course contains a course project where you will be required to submit one draft of the project at the end of Week 5 and the final completed project at the end of Week 7. Using the financial statements for Oracle Corporation and Microsoft Corporation, respectively, you will calculate and compare the financial ratios listed further down this document for the fiscal year ending 2007 and prepare your comments about the liquidity, solvency and profitability of the two companies based on your ratio calculations. The entire project will be graded by the instructor at the end of the final submission in week 7 and one grade will be assigned for the entire project. Overall Requirements For the Final Submission:

  19. Your final Excel workbook submission should contain the following. You cannot use any other software but Excel to complete this Project. A completed worksheet title page tab which is really a cover sheet with your name, my name, the class name, and the date. 1. A completed worksheet profiles tab which contains a one paragraph description regarding each company with information about their history, what products they sell, where they are located etc. 2. All 18 ratios for each company with the supporting calculations and commentary on your worksheet ratio tab. Supporting calculations must be shown either as a formula or as text typed into a different cell. The ratios are listed further down this document. Your comments for each ratio should include more than just a definition of the ratio. You should focus on interpreting each ratio number for each company and support your comments with the numbers found in the ratios. 3. The Summary and Conclusions worksheet tab which is an overall comparison of how each company compares in terms of the major category of ratios (Liquidity, Profitability, and Solvency). 4. The Bibliography worksheet tab must contain at least your textbook as a reference. Any other information you use to profile the companies should also be cited as a reference. 5.

  20. Required Ratios for Final Project Submission: 1. Earnings per Share 2. Current Ratio 3. Gross Profit Rate 4. Profit Margin Ratio 5. Inventory Turnover Ratio 6. Days in Inventory 7. Receivables Turnover Ratio 8. Average Collection Period 9. Asset Turnover Ratio 10. Return on Assets Ratio

  21. 11. Debt to Total Assets Ratio 12. Times Interest Earned Ratio 13. Payout ratio 14. Return on Common Stockholders' Equity Ratio 15. Free Cash Flow 16. Current Cash Debt Coverage Ratio 17. Cash Debt Coverage Ratio Price/Earnings Ratio [For the purpose of this ratio, use the market price per share on June 1, 2007 for each company] 18. The Excel files uploaded to the Dropbox should not include any unnecessary numbers or information (such as previous years' ratios, ratios that were not specifically asked for in the project, etc.).

  22. Please upload your final submission to the Dropbox by the end of Week 7. See Syllabus/"Due Dates for Assignments & Exams" for due date information. For the Draft: Create an Excel spreadsheet or use the Project template to show your computations for the first 12 ratios listed above. The more you can complete regarding the other requirements the closer you will be to completion when Week 7 arrives. Supporting calculations must be shown either as a formula or as text typed into a different cell. If you plan on creating your own spreadsheet, please follow the format provided in the Tootsie Roll and Hershey template file. Please upload your draft submission to the Dropbox by the end of Week 5. See Syllabus/"Due Dates for Assignments & Exams" for due date information. ***************************************************************************** ACCT 503 Entire Course

  23. For more classes visit www.snaptutorial.com ACCT 503 Week 1-7 All Discussion Questions ACCT 503 Week 3 Case Study 1 Flower Landscaping Corporation ACCT 503 Week 4 Midterm Exam Set 1 ACCT 503 Week 4 Midterm Set 2 ACCT 503 Week 4 Midterm Set 3 ACCT 503 Week 5 Case Study 2 Internal Control - LJB Company ACCT 503 Week 5 Course Project Draft Spreadsheet ACCT 503 Week 6 Case Study 3 - Cash Budgeting - LBJ Company ACCT 503 Week 7 Course Project JCP Kohls

  24. ********************************************************************************************************************************************************** ACCT 503 Final Exam (3 different finals) For more classes visit www.snaptutorial.com 1. (TCO A) Which one of the following is an advantage of corporations relative to partnerships and sole proprietorships? (Points : 5) Reduced legal liability for investors Harder to transfer ownership Lower taxes Most common form of organization 2. (TCO A) When a corporation distributes a dividend, _____. (Points : 5)

  25. the most common form of distribution is a cash dividend the Dividends account will be increased with a credit the Retained Earnings account will be directly increased with a debit the Dividends account will be decreased with a debit 3. (TCOs A, B) Below is a partial list of account balances for Cerner Company: Cash $5,000 Prepaid insurance 500 Accounts receivable 2,500 Accounts payable 2,000 Notes payable 3,000 Common stock 1,000 Dividends 500 Revenues 15,000 Expenses 12,500 What did Cerner Company show as total credits? (Points : 5) $21,500 $21,000 $20,500

  26. $22,000 4. (TCOs B, E) Using accrual accounting, expenses are recorded and reported only _____. (Points : 5) when they are incurred, whether or not cash is paid when they are incurred and paid at the same time if they are paid before they are incurred if they are paid after they are incurred 5. (TCO D) Three companies report the same cost of goods available for sale, but each employs a different inventory costing method. If the price of goods has increased during the period, then the company using _____. (Points : 5) LIFO will have the highest ending inventory FIFO will have the highest cost of goods sold All three companies will have the same value for ending inventory. average cost will have an ending inventory value that falls between FIFO and LIFO 6. (TCOs A, E) Equipment with a cost of $192,000 has an estimated salvage value of $18,000 and an estimated life of 4 years or 12,000 hours. It is to be depreciated by the straight-line method. What is the amount of depreciation for the first full year, during which the equipment was used 3,300 hours? (Points : 5) $48,000

  27. $52,500 $49,500 $43,500 7. (TCOs D, G) Joyce Corporation issues 1,000 ten-year, 8%, $1,000 bonds dated January 1, 2007, at 102. The journal entry to record the issuance will show a _____. (Points : 5) debit to Cash of $1,020,000 debit to Discount on Bonds Payable for $20,000 credit to Bonds Payable for $1,020,000 credit to Cash for $1,000,0008. (TCO C) Accounts receivable arising from sales to customers amounted to $80,000 and $70,000 at the beginning and end of the year, respectively. Income reported on the income statement for the year was $240,000. Exclusive of the effect of other adjustments, the cash flows from operating activities to be reported on the statement of cash flows is _____. (Points : 5) $240,000 $250,000 $310,000 $230,000 9. (TCO F) One variation of the horizontal analysis is known as _____. (Points : 5) nonlinear analysis vertical analysis

  28. trend analysis common-size analysis 10. (TCO F) Comparisons of data within a company are an example of the following comparative basis. (Points : 5) Industry averages Intercompany Intracompany Interregional 11. (TCO F) Which one of the following is not a characteristic generally evaluated in ratio analysis? (Points : 5) Liquidity Profitability Marketability of the product Solvency 12. (TCO F) Short-term creditors are usually most interested in assessing _____. (Points : 5) solvency liquidity marketability profitability

  29. 13. (TCO F) Long-term creditors are usually most interested in evaluating _____. (Points : 5) liquidity marketability profitability solvency 14. (TCO G) To calculate the market value of a bond, we need to _____. (Points : 5) find out the present value of all of the future cash payments promised by the bond calculate the present value of the principal only calculate the present value of the interest only multiply the bond price by the interest rate 1. (TCO A) Which one of the following is an advantage of corporations relative to partnerships and sole proprietorships? (Points : 5) Reduced legal liability for investors Harder to transfer ownership Lower taxes

  30. Most common form of organization 2. (TCO A) When a corporation distributes a dividend, _____. (Points : 5) the most common form of distribution is a cash dividend the Dividends account will be increased with a credit the Retained Earnings account will be directly increased with a debit the Dividends account will be decreased with a debit 3. (TCOs A, B) Below is a partial list of account balances for Cerner Company: Cash $5,000 Prepaid insurance 500 Accounts receivable 2,500 Accounts payable 2,000 Notes payable 3,000 Common stock 1,000 Dividends 500 Revenues 15,000

  31. Expenses 12,500 What did Cerner Company show as total credits? (Points : 5) $21,500 $21,000 $20,500 $22,000 4. (TCOs B, E) A small and private company may be able to justify using a cash basis of accounting if it has _____. (Points : 5) sales under $1,000,000 no accountants on staff insignificant receivables and payables all sales and purchases on account 5. (TCO D) Three companies report the same cost of goods available for sale, but each employs a different inventory costing method. If the price of goods has increased during the period, then the company using _____. (Points : 5)

  32. LIFO will have the highest ending inventory FIFO will have the highest cost of goods sold All three companies will have the same value for ending inventory. average cost will have an ending inventory value that falls between FIFO and LIFO 6. (TCOs A, E) Equipment was purchased for $60,000. Freight charges amounted to $2,800 and there was a cost of $8,000 for building a foundation and installing the equipment. It is estimated that the equipment will have a $12,000 salvage value at the end of its 5-year useful life. Depreciation expense each year using the straight-line method will be _____. (Points : 5) $14,160 $11,760 $9,840 $9,600 7. (TCOs D, G) Mendez Corporation issues 2,000 ten-year, 8%, $1,000 bonds dated January 1, 2007, at 103. The journal entry to record the issuance will show a _____. (Points : 5)

  33. debit to Cash of $2,000,000 debit to Premium on Bonds Payable for $60,000 credit to Bonds Payable for $2,000,000 credit to Cash for $2,060,000 8. (TCO C) Accounts receivable arising from sales to customers amounted to $35,000 and $40,000 at the beginning and end of the year, respectively. Income reported on the income statement for the year was $120,000. Exclusive of the effect of other adjustments, the cash flows from operating activities to be reported on the statement of cash flows is_____. (Points : 5) $120,000 $125,000 $155,000 $115,000 9. (TCO F) One variation of the horizontal analysis is known as _____. (Points : 5) nonlinear analysis

  34. vertical analysis trend analysis common-size analysis 10. (TCO F) In a common-size balance sheet, the 100% figure is _____. (Points : 5) total current assets total property, plant, and equipment total liabilities total assets 11. (TCO F) In vertical analysis, the base amount for studying salary and wages expense is generally _____. (Points : 5) net sales salary and wages expense in a previous year gross profit net income

  35. 12. (TCO F) A common measure of profitability is the _____. (Points : 5) current ratio current cash debt coverage ratio return on common stockholder's equity ratio debt to total assets 13. (TCO F) Return-on-assets ratio is most closely related to _____. (Points : 5) profit margin and debt-to-total-assets ratio profit margin and asset-turnover ratio times interest earned and debt-to-stockholders equity ratio profit margin and free cash flow 14. (TCO G) To calculate the market value of a bond, we need to _____. (Points : 5)

  36. find out the present value of all of the future cash payments promised by the bond calculate the present value of the principal only calculate the present value of the interest only multiply the bond price by the interest rate 1. (TCO A) An advantage of the corporate form of business is that _____. (Points : 5) it has limited life its owner's personal resources are at stake its ownership is easily transferable via the sale of shares of stock it is simple to establish 2. (TCO A) When a corporation distributes a dividend, _____. (Points : 5) the most common form of distribution is a cash dividend the Dividends account will be increased with a credit the Retained Earnings account will be directly increased with a debit the Dividends account will be decreased with a debit

  37. 3. (TCOs A, B) Below is a partial list of account balances for Denton Company: Cash $7,000 Prepaid insurance 700 Accounts receivable 3,500 Accounts payable 2,800 Notes payable 4,200 Common stock 1,400 Dividends 700 Revenues 21,000 Expenses 17,500 What did Denton Company show as total credits? (Points : 5) $30,100 $29,400 $28,700 $30,800 4. (TCOs B, E) A small and private company may be able to justify using a cash basis of accounting if it has _____. (Points : 5)

  38. sales under $1,000,000 no accountants on staff insignificant receivables and payables all sales and purchases on account 5. (TCO D) In a period of increasing prices, which inventory cost flow assumption will result in the lowest amount of income tax expense? (Points : 5) FIFO LIFO The average cost method Income tax expense for the period will be the same under all assumptions. 6. (TCOs A, E) Equipment was purchased for $60,000. Freight charges amounted to $2,800 and there was a cost of $8,000 for building a foundation and installing the equipment. It is estimated that the equipment will have a $12,000 salvage value at the end of its 5-year useful life. Depreciation expense each year using the straight-line method will be _____. (Points : 5) $14,160 $11,760

  39. $9,840 $9,600 7. (TCOs D, G) Lopez Corporation issues 500 ten-year, 8%, $1,000 bonds dated January 1, 2007, at 96. The journal entry to record the issuance will show a _____. (Points : 5) debit to Cash of $500,000 credit to Discount on Bonds Payable for $20,000 credit to Bonds Payable for $480,000 debit to Cash for $480,000 8. (TCO C) Accounts receivable arising from sales to customers amounted to $35,000 and $40,000 at the beginning and end of the year, respectively. Income reported on the income statement for the year was $120,000. Exclusive of the effect of other adjustments, the cash flows from operating activities to be reported on the statement of cash flows is _____. (Points : 5) $120,000 $125,000 $155,000 $115,000

  40. 9. (TCO F) Which one of the following is not a tool in financial statement analysis? (Points : 5) Horizontal analysis Circular analysis Vertical analysis Ratio analysis 10. (TCO F) In vertical analysis, the base amount for studying salary and wages expense is generally _____. (Points : 5) net sales salary and wages expense in a previous year gross profit net income 11. (TCO F) Ratios are most useful in identifying _____. (Points : 5) trends differences causes relationships among different numbers

  41. 12. (TCO F) A common measure of liquidity is _____. (Points : 5) return on assets current ratio profit margin debt to equity 13. (TCO F) Return-on-assets ratio is most closely related to _____. (Points : 5) profit margin and debt-to-total-assets ratio profit margin and asset-turnover ratio times interest earned and debt-to-stockholders equity ratio profit margin and free cash flow 14. (TCO G) To calculate the market value of a bond, we need to _____. (Points : 5) find out the present value of all of the future cash payments promised by the bond calculate the present value of the principal only calculate the present value of the interest only

  42. multiply the bond price by the interest rate 1. (TCO A) Below you will find selected information (in millions) from Coca-Cola Co.’s 2012 Annual Report: ................................................................................................................. ........................................................ Required: 1. Using the information provided prepare a Balance Sheet. Separate the current assets from non-current assets and provide a total for each. Also separate the current liabilities from the non-current liabilities and provide a total for each. 2. Using the Balance Sheet from your answer above calculate; Current Ratio, Days in Inventory, Average Collection Period, Return on Assets Ratio, Debt to Total Assets and Return on common stockholders’ equity ratio. (Make sure to show all your work) 2. (TCO B) The following selected data was retrieved from the Wal- Mart, Inc. financial statements for the year ending January 31, 2013: ................................................................................................................. ....................................................................................................... Required:

  43. Using the information provided above: 1. Prepare a multiple-step income statement 2. Calculate the Profit Margin, and Gross profit rate for the company. Be sure to provide the formula you are using, show your calculations, and discuss your findings/results. 3. (TCO C) Please review the following real-world Hewlett Packard Statement of Cash flows and address the 2 questions below: ................................................................................................................. ............................................................................................... Required: 1) Please calculate the percentage increase or decrease in cash for the operating, investing, and financing sections and explain the major reasons for the increase or decrease for each of these sections. 2) Please calculate the free cash flow for 2012 and explain the meaning of this ratio. 4. (TCO D) You are CFO of Goforit, Inc., a wholesale distribution company specializing in emerging technologies. Your CEO is a brilliant marketer, but relies on you to explain issues and choices in accounting and finance. She has heard from other members of a CEO organization to which she belongs that a company’s net income can vary widely

  44. depending on which accounting choices are made from the “GAAP menu.” Assuming the goal is to maximize net income, choose an accounting treatment from each of the following scenarios, and explain to your CEO why the choice will produce the desired effect on reported Net Income for the current year. Include in your answer the effect of the choice on both the income statement and balance sheet. Required: a. Goforit carries significant electronics inventory in a competitive environment where prices are actually falling. Which inventory valuation method would you choose—LIFO, FIFO, or average cost? Assume that unit purchases exceed unit sales. b. Goforit has a large investment in warehouse equipment including conveyor belts, forklifts, and automated packaging systems. Which depreciation method would you choose: Straight line (SL) or double declining balance (DDB)? 5. (TCO F) Please review the following real-world ratios for Johnson & Johnson and Pfizer for the year ended 2012 and address the 2 questions below.

  45. .................................................................................................................................................................................................................................. ................................................................................................. Required: 1) Please explain the meaning of each of the Pfizer ratios above. 2) Please state which company performed better for each ratio. ***************************************************************************** ACCT 503 Final Exam Guide (2 Set, New 2019) For more classes visit www.snaptutorial.com

  46. This Tutorial contains 2 Set of Final Exam Question 1.1. (TCO D) Please describe the purpose of the Income Statement and the interrelationship between the income statement and the other major financial statements that we covered in this class. In your answer, please also address which financial statements should be created before the Income Statement, if any, and which financial statements need to be completed after the Income Statement, if any. (Points : 25) Question 1—Set 2 1. Please describe the purpose of the Balance Sheet and the interrelationship between the balance sheet and the other major financial statements that we covered in this class. In your answer, please also address which financial statements should be created before the Balance Sheet, if any, and which financial statements need to be completed after the Balance Sheet, if any Question 2.2. (TCO E) Your friend, Lisa, plans to open a nail salon. Lisa states that she does not have time to develop and implement a system of internal controls. (a) Explain to Lisa the components of internal control. (10 points)

  47. (b) Explain to Lisa at least 5 internal control procedures she must establish to protect herself against fraud. You should state specific internal control procedures from the textbook, and relate your answer to her nail salon business. (15 points) (Points : 25) Q-2-Set 2 2. Your friend, John, plans to open a parking garage business. John states that he does not have time to develop and implement a system of internal controls. (a) Explain to John the objectives of a system of internal control. (b) Explain to John at least 5 internal control procedures that he must establish to protect himself against fraud. You should state specific internal control procedures from the textbook and relate your answer to his parking garage business. solution Question 3. (TCO A) The following items are taken from the financial statements of PQR Company for 2013: Cash $100,000 Instructions:

  48. (1) Create a classified balance sheet in good form for the year ended 2013. (30 points) (2) Calculate the current ratio and debt ratio and explain your findings. (6 points) (Points : 36) Question 3—Set 2 (TCO H) Corporations in need of cash can either issue stock or bonds to raise capital. What are the differences between these two activities and why might a company choose one over the other? (Points : 20) Q-3 Set 3 Question 4.4. (TCO A) The following items are taken from the financial statements of BCT Company for 2013: Instructions: (1) Create a classified balance sheet in good form for the year ended 2013. (30 points) (2) Calculate the current ratio and debt ratio and explain your findings. (6 points) (Points : 36) Question 4. (TCO B) The Caldor Company gathered the following condensed data for the year ended December 31, 2014: Instructions:

  49. (1) Prepare a multiple-step income statement for the year ended December 31, 2014. (30 points) (2) Compute the gross margin percentage and net profit margin ratio. Caldor Company’s assets at the beginning of the year were $900,000, and the assets were $950,000 at the end of the year. To qualify for full credit, you must state the formula you are using, show your computations, and explain your findings. (6 points) (Points : 36) Q-4 Set 2 Question 3.3. (TCO H) Simpson Inc. purchased 5, $4,000, 11% bonds of Hillsdale Corporation when the market rate of interest was 10%. Interest is paid semiannually on the bonds, and the bonds mature in 4 years. Instructions: Compute the total price paid by Simpson Inc. for the bonds showing your calculation for the present value of the principal and the present value of the interest payments. Present value tables (Exhibit 8-14 and Exhibit 8-15) are available on pages 452 and 453 of your Harrison, Horngren, and Thomas textbook. NOTE: Be sure you review the PV Tables completely to ensure you find the correct period and interest rate for the calculation. (Points : 20)

  50. Question 5. (TCO C) This is a 2-part question. Part 1) Indicate which section of the statement of cash flows should contain each of the following items, and whether each item would result in an inflow or outflow of cash. The sections are Operating, Investing, and Financing. (30 points) Part 2) Please explain how to calculate free cash flow and the importance of free cash flow to investors. (6 points) (Points : 36) Q-5 Set 2 5. The Alpha Company gathered the following condensed data for the year ended December 31, 2014: Instructions: (1) Prepare a multiple-step income statement for the year ended December 31, 2014. (2) Compute the gross margin percentage and net profit margin ratio. Alpha Company’s assets at the beginning of the year were $1,500,000, and the assets were $1,400,000 at the end of the year. To qualify for full credit, you must state the formula you are using, show your computations, and explain your findings. Question 6. (TCO F) This is a 2-part question.

More Related