Please help with accounting homework

Problem

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1

and

2012 2011

Data for Mariner Designs, Inc., follow:
MARINER DESIGNS, INC. Comparative Income Statement Years Ended December 31,		2012		2011
Net sales revenue:	$431,000	$372,350
Expenses:
Cost of goods sold	$200,000	$187,550
Selling and general expenses	99,000	91,050
Other expense	8,350	6,850
Total expenses	$307,350	$285,450
Net income	$123,650	$86,900
Requirements:
1. Prepare a horizontal analysis of the comparative income statement of Mariner Designs, Inc. Round percentage changes to one decimal place.
2. Why did 2012 net income increase by a higher percentage than net sales revenue?

Problem 2

2012 2011

$285,000 $309,500

Beta Graphics, Inc., has the following data:
BETA GRAPHICS, INC. Comparative Balance Sheet December 31, 2012 and 2011
Assets
Total current assets	$42,750	$59,000
Property, plant, and equipment, net	208,335	215,000
Other assets	33,915	35,500
Total assets		$285,000		$309,500
Liabilities
Total current liabilities	$49,020	$50,100
Long-term debt	109,155	102,300
Total liabilities	$158,175	$152,400
Stockholders’ Equity
Total stockholders’ equity	126,825	157,100
Total liabilities and stockholders’ equity
Requirement:
1. Perform a vertical analysis of Beta’s balance sheet for each year.

Problem 1

, Corp., and

, Inc., and have assembled the following data:

Digitalized Zone Network

Digitalized Zone Network

19,000

38,000

21,000

96,000

102,000

shares)

12,000

Digitalized Zone Network

Inventories

12,000

32,000

																																									Assume that you are purchasing an investment and have decided to invest in a company in the digital phone business. You have narrowed the choice to Save Time On Research and Writing Hire a Pro to Write You a 100% Plagiarism-Free Paper. Get My Paper			Digitalized			Zone Network
Selected income statement data for the current year:
Net sales (all on credit)	$423,035	$493,115
Cost of goods sold	206,000	258,000
Interest expense	—		19,000
Net income	54,000	66,000
Selected balance sheet and market price data at the end of the current year:
Current assets:
Cash	$23,000	$	21,000
Short-term investments		38,000
Current receivabales, net	43,000
	Inventories	64,000		96,000
Prepaid expenses	13,000
Total current assets	$184,000	$192,000
Total assets	$266,000	$326,000
Total current liabilities		102,000
Total liabilities	131,000
Common stock, $1 par (		12,000
$2 par (16,000 shares)		32,000
Total stockholder’s equity	$164,000	$195,000
Market price per share of common stock	$76.50	$94.99
Dividends paid per common share	$0.50	$0.40
Selected balance sheet data at the beginning of the current year:
Balance sheet:
Current receivables, net	$44,000	$53,000
80,000	86,000
Total assets	262,000	276,000
Common stock, $1 par (12,000 shares)
$2 par (16,000 shares)
Your strategy is to invest in companies that have low price/earnings ratios but appear to be in good shape financially. Assume that you have analyzed all other factors and that your decision depends on the results of ratio analysis.
Requirement:
1. Compute the following ratios for both companies for the current year, and decide which company’s stock better fits your investment strategy.
a. Acid-test ratio b. Inventory turnover c. Days’ sales in receivables d. Debt ratio e. Earnings per share of common stock f. Price/earnings ratio g. Dividend payout

Task 1

The Windshield People repair chips in car windshields in the company’s home county. Rocky Chip, the owner, incurred the following operating costs for the month of February 2012:
Salaries and wages	$9,000
Windshield repair materials	4,900
Depreciation on truck	250
Depreciation on building and equipment	800
Supplies expense	600
Gasoline and utilities	2,130
The Windshield People earned $26,000 in revenues for the month of February by repairing 500 windshields. All costs shown are considered to be directly related to repair service.
	Requirements:
1. Prepare an income statement for the month of February. Compute the ratio of total operating expense to total revenue and operating income to total revenue.
2. Compute the per unit cost of repairing one windshield.
3. The manager of The Windshield People must keep unit operating cost below $50 per windshield in order to get his bonus. Did he meet the goal?
4. What kind of system could The Windshield People use to integrate all its data?

Task 2

Requirements:

Natalia Wallace is the new controller for Smart Software, Inc., which develops and sells education software. Shortly before the December 31 fiscal year-end, James Cauvet, the company president, asks Wallace how things look for the year-end numbers. He is not happy to learn that earnings growth may be below 13% for the first time in the company’s five-year history. Cauvet explains that financial analysts have predicted a 13% earnings growth for the company and that he does not intend to disappoint them. He suggests that Wallace talk to the assistant controller, who can explain how the previous controller dealt with such situations. The assistant controller suggests the following strategies: a. Persuade suppliers to postpone billing $13,000 in invoices until January 1. b. Record as sales $115,000 in certain software awaiting sale that is held in a public warehouse. c. Delay the year-end closing a few days into January of the next year so that some of next year’s sales are included as this year’s sales. d. Reduce the estimated bad debt expense from 5% of sales revenue to 3%, given the company’s continued strong performance. e. Postpone routine monthly maintenance expenditures from December to January.

1. Which of these suggested strategies are inconsistent with IMA standards?

2. What should Wallace do if Cauvet insists that she follow all of these suggestions?

Task 3

In 400-500 words, discuss the differences between managerial and financial accounting.

Problem 1

Snyder Brush Company sells standard hair brushes. The following information summarizes Snyder’s operating activities for 2012:
Selling and administrative expenses	$49,680
Purchases	78,000
Sales revenue	138,000
Merchandise inventory, January 1, 2012	7,500
Merchandise inventory, December 31, 2012	12,360
Requirements:
1. Prepare an income statement for 2012. Compute the ratio of operating expense to total revenue and operating income to total revenue.
2. Snyder sold 6,000 brushes 2012. Compute the unit cost for one brush.