ACC 421 Week 4 Wiley Plus Assignment – Exercises

  

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ACC 421 Week 4 Wiley Plus Assignment – Exercises

Problem 1

The income statement of Rodriquez Company is shown below.

   

    

 

,870

  

 

  

 

  

 

  

   

   

    

 

  

 

 

   

RODRIQUEZ COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31,

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2012

Sales

$6,894,600

Cost of goods sold

   Beginning inventory

$

1,893

   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. 

2. 

3. 

to suppliers of merchandise decreased $281,970 during the year.

4. 

5. 

Accounts receivable decreased $312,690 during the year.

Prepaid expenses increased $178,550 during the year.

Accounts payable

Accrued expenses payable decreased $124,510 during the year.

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 by operating activities

$[removed]

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) 

payments to suppliers

 $[removed]

(b) 

 $[removed]

Cash

Cash payments for operating expenses

 

Problem 3

Condensed financial data of Fairchild Company for 2012 and

2011

are presented below.

  2012 2011Cash 

  

 

 

  

 

 

  

 

 

  

 

 

)

 

  

 

  

  

 

       Accounts payable 

  

 

 

  

 

 

  

 

 1,893  

 

 

  

 

  $7,143  $6,291 

FAIRCHILD COMPANY COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2012 AND 2011

$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

$1,207

$796

Accrued liabilities

203

245

Bonds payable

1,418

1,631

Common stock

1,706

Retained earnings

2,422

1,913

 

Sales 

Cost of goods sold 

 

 

 

  

 82

 

 

Net income 

FAIRCHILD COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2012

$6,851

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

Income before tax

1,312

Income tax expense

531

$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 COMPARATIVE BALANCE SHEET AS OF DECEMBER 31, 2012 AND 2011  2012 2011

Cash 

  

 

Receivables 

  

 

Inventory 

  

 

Plant assets 1,893  

 

Accumulated depreciation 

)

Long-term investments (held-to-maturity) 1,299  

 

  

  

 

       

Accounts payable 

  

 

Accrued liabilities 

  

 

Bonds payable 

  

 

Common stock 

  

 

Retained earnings 

  

 

  $7,137  $6,316 

$1,803

$1,095

1,755

1,291

1,581

1,910

1,708

(1,194

(1,163

1,475

$7,137

$6,316

$1,205

$789

213

235

1,411

1,649

1,898

1,692

2,410

1,951

 

FAIRCHILD COMPANY INCOME STATEMENT FOR THE YEAR ENDED DECEMBER 31, 2012

Sales 

Cost of goods sold 

Gross margin 

Selling and administrative expenses 

Income from operations 

Other revenues and gains  

   Gain on sale of investments 80Income before tax 

Income tax expense 

Net income 

$6,828

4,694

2,134

935

1,199

1,279

547

$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.)

  

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