ACC 421 Week 4 Wiley Plus Assignment – Exercises
Problem 1
The income statement of Rodriquez Company is shown below.
|
RODRIQUEZ COMPANY |
||||
|
Sales |
$6,894,600 |
|||
|
Cost of goods sold |
||||
|
Beginning inventory |
$1,893,870 |
|||
|
Purchases |
4,375,530 |
|||
|
Goods available for sale |
6,269,400 |
|||
|
Ending inventory |
1,608,650 |
|||
|
Cost of goods sold |
4,660,750 |
|||
|
Gross profit |
2,233,850 |
|||
|
Operating expenses |
||||
|
Selling expenses |
440,640 |
|||
|
Administrative expenses |
703,840 |
1,144,480 |
||
|
Net income |
$1,089,370 |
Additional information:
|
1. |
Accounts receivable decreased $312,690 during the year. |
|
|
2. |
Prepaid expenses increased $178,550 during the year. |
|
|
3. |
Accounts payable to suppliers of merchandise decreased $281,970 during the year. |
|
|
4. |
Accrued expenses payable decreased $124,510 during the year. |
|
|
5. |
Administrative expenses include depreciation expense of $55,760. |
Prepare the operating activities section of the statement of cash flows using the direct method.
Problem 2
Presented below are two independent situations.
Situation A:
Chenowith Co. reports revenues of $200,680 and operating expenses of $110,380 in its first year of operations, 2012. Accounts receivable and accounts payable at year-end were $79,260 and $40,870, respectively. Assume that the accounts payable related to operating expenses. Ignore income taxes.
Using the direct method, compute net cash provided (used) by operating activities. (If an amount reduces the account balance then enter with negative sign.)
|
Net cash providedusedby operating activities |
$ |
|
Situation B:
The income statement for Edgebrook Company shows cost of goods sold $307,650 and operating expenses (exclusive of depreciation) $231,760. The comparative balance sheet for the year shows that inventory increased $21,380, prepaid expenses decreased $7,680, accounts payable (related to merchandise) decreased $15,450, and accrued expenses payable increased $13,950.
Compute (a) cash payments to suppliers and (b) cash payments for operating expenses.
|
(a) |
Cash payments to suppliers |
$ |
||
|
(b) |
Cash payments for operating expenses |
$ |
Problem 3
Condensed financial data of Fairchild Company for 2012 and 2011 are presented below.
|
FAIRCHILD COMPANY |
||||||
|
2012 |
2011 |
|||||
|
Cash |
$1,801 |
$1,091 |
||||
|
Receivables |
1,757 |
1,301 |
||||
|
Inventory |
1,594 |
1,900 |
||||
|
Plant assets |
1,897 |
1,707 |
||||
|
Accumulated depreciation |
(1,205 |
) |
(1,170 |
) |
||
|
Long-term investments (held-to-maturity) |
1,299 |
1,462 |
||||
|
$7,143 |
$6,291 |
|||||
|
Accounts payable |
$1,207 |
$796 |
||||
|
Accrued liabilities |
203 |
245 |
||||
|
Bonds payable |
1,418 |
1,631 |
||||
|
Common stock |
1,893 |
1,706 |
||||
|
Retained earnings |
2,422 |
1,913 |
||||
|
$7,143 |
$6,291 |
|
FAIRCHILD COMPANY |
||
|
Sales |
$6,851 |
|
|
Cost of goods sold |
4,691 |
|
|
Gross margin |
2,160 |
|
|
Selling and administrative expenses |
930 |
|
|
Income from operations |
1,230 |
|
|
Other revenues and gains |
||
|
Gain on sale of investments |
82 |
|
|
Income before tax |
1,312 |
|
|
Income tax expense |
531 |
|
|
Net income |
$781 |
Additional information:
During the year, $78 of common stock was issued in exchange for plant assets. No plant assets were sold in 2012. Cash dividends were $272.
Prepare a statement of cash flows using the indirect method. (If an amount reduces the account balance then enter with negative sign.)
Problem 4
Condensed financial data of Fairchild Company for 2012 and 2011 are presented below.
|
FAIRCHILD COMPANY |
||||||
|
2012 |
2011 |
|||||
|
Cash |
$1,803 |
$1,095 |
||||
|
Receivables |
1,755 |
1,291 |
||||
|
Inventory |
1,581 |
1,910 |
||||
|
Plant assets |
1,893 |
1,708 |
||||
|
Accumulated depreciation |
(1,194 |
) |
(1,163 |
) |
||
|
Long-term investments (held-to-maturity) |
1,299 |
1,475 |
||||
|
$7,137 |
$6,316 |
|||||
|
Accounts payable |
$1,205 |
$789 |
||||
|
Accrued liabilities |
213 |
235 |
||||
|
Bonds payable |
1,411 |
1,649 |
||||
|
Common stock |
1,898 |
1,692 |
||||
|
Retained earnings |
2,410 |
1,951 |
||||
|
$7,137 |
$6,316 |
|
FAIRCHILD COMPANY |
||
|
Sales |
$6,828 |
|
|
Cost of goods sold |
4,694 |
|
|
Gross margin |
2,134 |
|
|
Selling and administrative expenses |
935 |
|
|
Income from operations |
1,199 |
|
|
Other revenues and gains |
||
|
Gain on sale of investments |
80 |
|
|
Income before tax |
1,279 |
|
|
Income tax expense |
547 |
|
|
Net income |
$732 |
Additional information:
During the year, $78 of common stock was issued in exchange for plant assets. No plant assets were sold in 2012. Cash dividends were $273.
Prepare a statement of cash flows using the direct method. (If an amount reduces the account balance then enter with negative sign.)