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E13-1 |
Pioneer Corporation had the transactions below during 2011.
Analyze the transactions and indicate whether each transaction resulted in a cash flow from operating activities, investing activities, financing activities, or noncash investing and financing activities.
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(a) |
Issued $ 50,000 par value common stock for cash. |
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(b) |
Purchased a machine for $30,000, giving a long-term note in exchange. |
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(c) |
Issued $ 200,000 par value common stock upon conversion of bonds having a face value of $200,000. |
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(d) |
Declared and paid a cash dividend of $ 18,000 . |
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(e) |
Sold a long-term investment with a cost of $15,000 for $15,000 cash. |
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(f) |
Collected $16,000 of accounts receivable. |
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(g) |
Paid $18,000 on accounts payable. |
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E13-8
Here are comparative balance sheets for Taguchi Company.
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TAGUCHI COMPANY
Comparative Balance Sheets
December 31
Assets
2011
2010
Cash
$73,000
$22,000
Accounts receivable
85,000
76,000
Inventories
1
70,000
189,000
Land
75,000
100,000
Equipment
260,000
200,000
Accumulated depreciation
(66,000)
(32,000)
Total
$597,000
$555,000
Liabilities
and
Stockholders’ Equity
Accounts payable
$39,000
$47,000
Bonds payable
150,000
Common stock
($1 par)
216,000
174,000
Retained earnings
192,000
134,000
Total
$597,000
$555,000
Additional information:
1.
Net income
for 2011 was $103,000.
2. Cash dividends of $45,000 were declared and paid.
3. Bonds payable amounting to $50,000 were redeemed for cash $50,000.
4. Common stock was issued for $
42,000
cash.
5. No equipment was sold during 2011, but land was sold at cost.
Complete the statement of cash flows for 2011 using the indirect method.
(List amounts from largest positive to smallest positive followed by most negative to least negative, e.g. 15, 14, 10, -17, -5, -1. If amount decreases cash flow, use either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
TAGUCHI COMPANY
Statement of Cash Flows
For the Year Ended December 31, 2011
Cash flows from operating activities
$
Adjustments to reconcile net income
to net cash provided by operating activities
$
Net cash by operating activities
Cash flows from investing activities
Net cash by investing activities
Cash flows from financing activities
Net cash by financing activities
Net in cash
Cash at beginning of period
Cash at end of period
$
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E14-1 |
Financial information for Blevins Inc. is presented below.
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December 31, 2012 |
December 31, 2011 |
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Current assets |
$125,000 |
$100,000 |
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Plant assets (net) |
396,000 |
330,000 |
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Current liabilities |
91,000 |
70,000 | |
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Long-term liabilities |
133,000 |
95,000 |
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Common stock, $1 par |
161,000 |
115,000 |
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136,000 |
Complete the schedule showing a horizontal analysis for 2012 using 2011 as the base year.
(If amount is a decrease, use either a negative sign preceding the number eg -45 or parentheses eg (45). Round percentages to 1 decimal place, e.g. 10.5. List items in the order given in the question.)
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BLEVINS INC. |
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Condensed Balance Sheet |
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Increase or (Decrease) |
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2012 |
Amount |
Percentage |
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| Assets | |||||||||||
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% |
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Total assets |
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| Liabilities | |||||||||||
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Total liabilities |
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| Stockholders’ Equity | |||||||||||
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Total stockholders equity |
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Total liabilities and stockholders’ equity |
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P13-9A
Condensed financial data of Arma Inc. follow.
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ARMA INC. |
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$90,800 |
$48,400 |
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92,800 |
33,000 |
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112,500 |
102,850 |
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Prepaid expenses |
28,400 |
26,000 |
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Investments |
138,000 |
1 14,000
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| Plant assets |
270,000 |
242,500 |
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(50,000) |
(52,000) |
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$682,500
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$514,750
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$112,000 |
$67,300 |
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Accrued expenses payable |
16,500 |
17,000 |
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110,000 |
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| Common stock |
220,000 |
175,000 |
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224,000 |
105,450 |
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| $682,500 | $514,750 |
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Income Statement |
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Sales |
$392,780 |
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Less: |
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Cost of goods sold |
$135,460 |
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Operating expenses, excluding depreciation |
12,410 |
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Depreciation expense |
46,500 |
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Income taxes |
27,280 |
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Interest expense |
4,730 |
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Loss on sale of plant assets |
7,500 |
233,880 |
| Net income |
$158,900 |
Additional information:
1. New plant assets costing $85,000 were purchased for cash during the year.
2. Old plant assets having an original cost of $57,500 were sold for $1,500 cash.
3. Bonds matured and were paid off at face value for cash.
4. A cash dividend of $40,350 was declared and paid during the year.
Complete the statement of cash flows using the indirect method.
(List amounts from largest positive to smallest positive followed by most negative to least negative, e.g. 15, 14, 10, -17, -5, -1. If amount decreases cash flow, use either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
ARMA INC.
Statement of Cash Flows
For the Year Ended December 31, 2011
Cash flows from operating activities
$
Adjustments to reconcile net income to net
cash provided by operating activities
$
Net cash by operating activities
Cash flows from investing activities
Net cash by investing activities
Cash flows from financing activities
Net cash by financing activities
Net in cash
Cash at beginning of period
Cash at end of period
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P13-10A |
Condensed financial data of Arma Inc. follow.
ARMA INC.
Comparative Balance Sheets
December 31
Assets
2011
2010
Cash
$90,800
$48,400
Accounts receivable
92,800
33,000
Inventories
112,500
102,850
Prepaid expenses
28,400
26,000
Investments
138,000
114,000
Plant assets
270,000
242,500
Accumulated depreciation
(50,000)
(52,000)
Total
$682,500
$514,750
Liabilities and Stockholders’ Equity
Accounts payable
$112,000
$67,300
Accrued expenses payable
16,500
17,000
Bonds payable
110,000
150,000
Common stock
220,000
175,000
Retained earnings
224,000
105,450
Total
$682,500
$514,750
ARMA INC.
Income Statement
For the Year Ended December 31, 2011
Sales
$392,780
Less:
Cost of goods sold
$135,460
Operating expenses, excluding depreciation
12,410
Depreciation expense
46,500
Income taxes
27,280
Interest expense
4,730
Loss on sale of plant assets
7,500
233,880
Net income
$158,900
Additional information:
1. New plant assets costing $85,000 were purchased for cash during the year.
2. Old plant assets having an original cost of $57,500 were sold for $1,500 cash.
3. Bonds matured and were paid off at face value for cash.
4. A cash dividend of $40,350 was declared and paid during the year.
Further analysis reveals that accounts payable pertain to merchandise creditors.
Complete the statement of cash flows for Arma Inc. using the direct method.
(List amounts from largest positive to smallest positive followed by most negative to least negative, e.g. 15, 14, 10, -17, -5, -1. If amount decreases cash flow for financing and investing activities, use either a negative sign preceding the number e.g. -45 or parentheses e.g. (45). List all other amounts as positive.)
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Less cash payments |
| Net cash by investing activities |
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P14-2A |
The comparative statements of Villa Tool Company are presented below.
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VILLA TOOL COMPANY |
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For the Year Ended December 31 |
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2012 |
2011 |
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Net sales |
$1,818,500 |
$1,750,500 |
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| Cost of goods sold |
1,011,500 |
996,000 |
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Gross profit |
807,000 |
754,500 |
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Selling and administrative expense |
516,000 |
479,000 |
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Income from operations |
291,000 |
275,500 |
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Other expenses and losses |
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| 18,000 | 14,000 | |||
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Income before income taxes |
273,000 |
261,500 |
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Income tax expense |
81,000 |
77,000 |
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$ 192,000 |
$ 184,500 |
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Balance Sheets |
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Assets |
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Cash |
$ 60,100 |
$ 64,200 |
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Short-term investments |
69,000 |
50,000 | ||
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Accounts receivable (net) |
117,800 |
102,800 |
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Inventory |
123,000 |
115,500 |
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Total current assets |
369,900 |
332,500 |
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Plant assets (net) |
600,300 |
520,300 |
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| Total assets |
$970,200 |
$852,800 |
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Current liabilities |
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Accounts payable |
$160,000 |
$145,400 |
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Income taxes payable |
43,500 |
42,000 | ||
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Total current liabilities |
203,500 |
187,400 |
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Total liabilities |
403,500 |
387,400 |
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Stockholders’ equity |
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Common stock ($5 par) |
280,000 |
300,000 |
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Retained earnings |
286,700 |
165,400 |
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Total stockholders’ equity |
566,700 |
465,400 |
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| Total liabilities and stockholders’ equity |
Compute the following ratios for 2012. (Weighted average common shares in 2012 were 57,000, and all sales were on account.)
(Round earnings per share, current ratio and acid-test ratio to 2 decimal places, e.g. 10.50. Round other answers to 1 decimal place, e.g. 10.5.)
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Earnings per share |
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Return on common stockholders’ equity |
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Return on assets |
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| Current |
:1
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Acid-test |
:1 | |||
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Receivables turnover |
times |
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Inventory turnover |
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(h) |
Times interest earned |
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(i) |
Asset turnover |
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(j) |
Debt to total assets |
