Below is the Trial Balance for Clay Employment Services, year ending December 31, 2011. Previous period’s information were as follows: net receivables, $290,000 and inventory, $82,000. Total revenues were $350,000 for 2010, 360,000 for 2009, and 295,000 for 2008.
1) Prepare the income statement, statement of retained earnings, and balance sheet.
2) find out the following ratios: current ratio, quick ratio, debt ratio, accounts receivable turnover, and inventory turnover. Briefly describe your answers.
3) find out the vertical analysis for total current assets.
4) find out the horizontal analysis on total revenues from 2008 thru 2011.
ABC Corporation accountants have assembled the following data for the year ended December 31, 2007.
Prepare ABC Corporation’s statement of cash flows using the indirect method. Include an accompanying schedule of noncash investing and financing activities.
Cash and cash equivalents $85,000 $22,000
Accounts receivable 69,200 64,200
Inventories 80,000 83,000
Accounts payable $57,800 $55,800
Income tax payable 14,700 16,700
Transaction data for 2007:
Net income $ 57,000 Purchase of treasury stock $14,000
Issuance of common stock for cash 41,000 Loss on sale of equipment 11,000
Depreciation expense 21,000 Payment of cash dividends 18,000
Purchase of building 125,000 Issuance of long-term note
Retirement of bonds payable by payable to borrow cash 34,000
Issuing common stock 65,000 Sale of equipment 58,000
At the beginning of the current year, MegaSounds opened a music store that sells compact disks. At the end of the year, a physical inventory count revealed that 2,500 of those disks are on hand.
1) find out the total cost for each purchase date.
2) find out the ending inventory using (a) FIFO, (b) LIFO, and Average Cost methods.
PROBLEM D: Machinery purchased on January 1, 2011:
Cost of machinery 250,000
Estimated residual value 10,000
Estimated useful life:
Years 6 years
Units of production 200,000 machine hours
find out depreciation at each year end that applies:
1) Straight-line method.
2) Units of production method.
Assumption: Machinery machine hours on the 1st year, 66,000; 2nd year, 60,000; 3rd year, 38,000; 4th year, 22,000; 5th year, 8,000; and 6th year, 6,000
3) Double-declining method.