Managerial Accounting 1B Ch13

Managerial Accounting 1B

Financial and Managerial Accounting

Chapter 13

1.

 

Exercise 13-3 Computation and analysis of trend percents L.O. P1

 

2013

2012

2011

2010

2009

  Sales

$

283,880  

$ 271,800  

$ 253,680  

$ 235,560  

$ 151,000  

  Cost of goods sold

129,200  

123,080  

116,280  

107,440  

68,000  

  Accounts receivable

19,100  

18,300  

17,400  

16,200  

10,000  

  

Compute trend percents for the above accounts, using 2009 as the base year. (Omit the “%” sign in your response.)

  

2.

 

Exercise 13-7 Common-size percents L.O. P2

Sanderson Company’s year-end balance sheets follow.

  

     

2012     2011     2010

 

Assets

At December 31

     

 

           

Cash

  $

30,800

  $

35,625

  $

36,800  

 

Accounts receivable, net

   

88,

500

   

62,500

   

49,200  

 

Merchandise inventory

   

111,500

   

82,500

   

53,000  

 

Prepaid expenses

   

9,700

   

9,375

   

4,000  

 

Plant assets, net

   

277,500

   

255,000

   

229,500  

            

Total assets

  $

518,000

  $

445,000

  $

372,500  

            

Liabilities and Equity

                   

Accounts payable

  $

128,900

  $

75,250

  $

49,250  

 

Long-term notes payable secured by   mortgages on plant assets

   

97,500

   

102,500

   

82,500  

 

Common stock, $10 par value

   

162,500

    162,500    

162,500  

 

Retained earnings

   

129,100

   

104,750

   

78,250  

          

 

Total liabilities and equity

  $ 518,000   $ 445,000   $ 372,500  

          

  

Express the balance sheets in common-size percents. (Do not round intermediate calculations and round your final answers to 1 decimal place. Omit the “%” sign in your response.)

    

Exercise 13-9 Liquidity analysis and interpretation L.O. P3

[The following information applies to the questions displayed below.]

Sanderson Company’s year-end balance sheets follow.   

  At December 31     2012     2011     2010

 

                 

  Cash   $ 30,800   $ 35,625   $ 36,800     Accounts receivable, net     88,500     62,500     49,200     Merchandise inventory     111,500     82,500     53,000     Prepaid expenses     9,700     9,375     4,000     Plant assets, net     277,500     255,000     229,500  

         

  Total assets   $ 518,000   $ 445,000   $ 372,500  

         

  Liabilities and Equity                     Accounts payable   $ 128,900   $ 75,250   $ 49,250     Long-term notes payable secured by   mortgages on plant assets     97,500     102,500     82,500     Common stock, $10 par value     162,500     162,500     162,500     Retained earnings     129,100     104,750     78,250               Total liabilities and equity   $ 518,000   $ 445,000   $ 372,500            

Assets

  

The company’s income statements for the years ended December 31, 2012 and 2011, follow. Assume that all sales are on credit:

  

2012 2011

  Sales       $

        $

  Cost of goods sold $

        $

     

 

         

     

 

         

     

 

         

     

               

       

         

               

      $

        $

               

      $

        $

               

 For Year Ended December 31

672,500

530,000  

410,225

344,500

  Other operating expenses

208,550

133,980

  Interest expense

11,100

12,300

  Income taxes

8,525

7,845

  Total costs and expenses

638,400

498,625  

  Net income

34,100

31,375  

  Earnings per share

2.10

1.93  

 

 

Section Break

Exercise 13-9 Liquidity analysis and interpretation L.O. P3

 

 3.

   

Exercise 13-9 Part 1

(1)

 Compute days’ sales uncollected. (Use 365 days a year. Do not round intermediate calculations and roundyour final answers to the nearest whole number.)

  

 4.

   

Exercise 13-9 Part 2

(2)

 Compute accounts receivable turnover. (Round your answers to 1 decimal place.)

  

   

 

 

  2012

  2011

 

 5.

   

Exercise 13-9 Part 3

(3)

 Compute inventory turnover. (Round your answers to 1 decimal place.)

    

 6.

   

Exercise 13-9 Part 4

(4)

 Compute days’ sales in inventory. (Use 365 days a year. Do not round intermediate calculations and round your final answers to the nearest whole number.)

         2012     2011    

Problem 13-1A Ratios, common-size statements, and trend percents L.O. P1, P2, P3

[The following information applies to the questions displayed below.]

 

Selected comparative financial statements of Bennington Company follow:

  

      2012       2011       2010     Sales   $

    $

    $

 

  Cost of goods sold    

     

     

 

             

   

     

     

 

   

     

     

 

   

     

     

 

             

   

     

     

 

             

   

     

     

 

  Income taxes    

     

     

 

             

  Net income   $

    $

    $

 

             

BENNINGTON COMPANY

Comparative Income Statements

For Years Ended

December 31, 2012, 2011, and 2010

444,000

340,000

23

6,000

267,288

212,500

151,040

  Gross profit

176,712

127,500

84,960

  Selling expenses

62,694

46,920

31,152

  Administrative expenses

40,137

29,920

19,470

  Total expenses

102,831

76,840

50,622

  Income before taxes

73,881

50,660

34,338

13,764

10,370

6,962

60,117

40,290

27,376

  

BENNINGTON COMPANY

December 31, 2012, 2011, and 2010

      2012       2011       2010  

                       

  $

    $

    $

 

   

     

     

 

   

     

     

 

             

  $

    $

    $

 

             

                       

  $

    $

    $

 

   

      72,000      

 

   

      9,000      

 

   

     

     

 

             

  $ 138,480     $ 134,424     $ 111,368  

             

Comparative Balance Sheets

  Assets

  Current assets

48,480

37,924

50,648

  Long-term investments

0 500

3,720

  Plant assets, net

90,000

96,000

57,000

  Total assets

138,480

134,424

111,368

  Liabilities and Equity

  Current liabilities

20,200

19,960

19,480

  Common stock

72,000

54,000

  Other paid-in capital

9,000

6,000

  Retained earnings

37,280

33,464

31,888

  Total liabilities and equity

         

 7.

 

Problem 13-1A Part 1

Required:

1.

Compute each year’s current ratio. (Round your answers to 1 decimal place.)

  

         

     

Current ratio

     

Current ratio

     

Current ratio

December 31, 2012:

December 31, 2011:

December 31, 2010:

 

 8.

 

Problem 13-1A Part 2

2.

Express the income statement data in common-size percents. (Round your answers to 2 decimal places. Omit the “%” sign in your response.)

    

9.    

Problem 13-1A Part 3

3.

Express the balance sheet data in trend percents with 2010 as the base year. (Round your answers to 2 decimal places. Leave no cells blank – be certain to enter “0” wherever required. Omit the “%” sign in your response.)

    

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