29 Jun Question Financial & Managerial Accting MBA-56
Question
Financial & Managerial Accting MBA-560
Problem 9-22
Required
Use the financial statements for Bernard Company from Problem 9-22 to calculate the following for 2012 and 2011.
a. Working capital
b. Current ratio
c. Quick ratio
d. Accounts receivable turnover (beginning receivables at January 1, 2011, were $47,000)
e. Average number of days to collect accounts receivable
f. Inventory turnover (beginning inventory at January 1, 2011, was $140,000)
g. Average number of days to sell inventory
h. Debt to assets ratio
i. Debt to equity ratio
j. Times interest earned
k. Plant assets to long-term debt
l. Net margin
m. Asset turnover
n. Return on investment
o. Return on equity
p. Earnings per share
q. Book value per share of common stock
r. Price-earnings ratio (market price per share: 2011, $11.75; 2012, $12.50)
s. Dividend yield on common stock
problem 10-22
Kirsoff Company makes eBook readers.
The company had the following amounts at the beginning of 2011: Cash, $660,000; Raw Materials Inventory, $51,000; Work in Process Inventory, $18,000; Finished Goods Inventory, $43,000; Common Stock, $583,000; and Retained Earnings, $189,000. Kirsoff experienced the following accounting events during 2011. Other than the adjusting entries for depreciation, assume that all transactions are cash transactions. 1. Paid $23,000 of research and development costs. 2. Paid $47,000 for raw materials that will be used to make eBook readers. 3. Placed $83,000 of the raw materials cost into the process of manufacturing eBook readers. 4. Paid $60,000 for salaries of selling and administrative employees. 5. Paid $91,000 for wages of production workers. 6. Paid $90,000 to purchase equipment used in selling and administrative offices. 7. Recognized depreciation on the office equipment. The equipment was acquired on January, 1, 2011. It has a $10,000 salvage value and a five-year life. The amount of depreciation is computed as [(Cost – salvage) ÷ useful life]. Specifically, ($90,000 – $10,000) ÷ 5 = $16,000. 8. Paid $165,000 to purchase manufacturing equipment. 9. Recognized depreciation on the manufacturing equipment. The equipment was acquired on January 1, 2011. It has a $25,000 salvage value and a seven-year life. The amount of depreciation is computed as [(Cost – salvage) ÷ useful life]. Specifically, ($165,000 – $25,000) ÷ 7 = $20,000. 10. Paid $45,000 for rent and utility costs on the manufacturing facility. 11. Paid $70,000 for inventory holding expenses for completed eBook readers (rental of warehouse space, salaries of warehouse personnel, and other general storage cost). 12. Completed and transferred eBook readers that had total cost of $240,000 from work in process inventory to finished goods. 13. Sold 1,000 eBook readers for $420,000. 14. It cost Kirsoff $220,000 to make the eBook readers sold in Event 13. Required a. Show how these events affect the balance sheet, income statement, and statement of cash flows by recording them in a horizontal financial statements model. b. Explain why Kirsoff’s recognition of cost of goods sold had no impact on cash flow. c. Prepare a schedule of cost of goods manufactured and sold, a formal income statement, and a balance sheet for the year. d. Distinguish between the product costs and the upstream costs that Kirsoff incurred. e. The company president believes that Kirsoff could save money by buying the inventory that it currently makes. The warehouse manager said that would not be a good idea because the purchase price of $230 per unit was above the $220 average cost per unit of making the product. Assuming the purchased inventory would be available on demand, explain how the company could be correct and why the production manager could be biased in his assessment of the option to buy the inventory.
Our website has a team of professional writers who can help you write any of your homework. They will write your papers from scratch. We also have a team of editors just to make sure all papers are of HIGH QUALITY & PLAGIARISM FREE. To make an Order you only need to click Ask A Question and we will direct you to our Order Page at WriteDemy. Then fill Our Order Form with all your assignment instructions. Select your deadline and pay for your paper. You will get it few hours before your set deadline.
Fill in all the assignment paper details that are required in the order form with the standard information being the page count, deadline, academic level and type of paper. It is advisable to have this information at hand so that you can quickly fill in the necessary information needed in the form for the essay writer to be immediately assigned to your writing project. Make payment for the custom essay order to enable us to assign a suitable writer to your order. Payments are made through Paypal on a secured billing page. Finally, sit back and relax.
About Writedemy
We are a professional paper writing website. If you have searched a question and bumped into our website just know you are in the right place to get help in your coursework. We offer HIGH QUALITY & PLAGIARISM FREE Papers.
How It Works
To make an Order you only need to click on “Order Now” and we will direct you to our Order Page. Fill Our Order Form with all your assignment instructions. Select your deadline and pay for your paper. You will get it few hours before your set deadline.
Are there Discounts?
All new clients are eligible for 20% off in their first Order. Our payment method is safe and secure.