According to the producer price index database maintained by the Bureau of Labor Statistics, the average cost of computer equipment fell 3.8 percent between January and December 2018. Let's see whether these changes are reflected in the income statement of Wizard Computers for the year ended December 31, 2018. Sales Revenue Cost of Goods Sold Gross Profit Selling, General, and Administrative Expenses Interest Expense Income before Income Tax Expense Income Tax Expense Net Income Required: 2018 $ 114,000 67,000 2017 $ 141,000 77,100 47,000 63,900 37,400 39,800 640 545 8,960 2,000 23,555 6,400 $ 6,960 $ 17,155 1. Compute the times interest earned ratios for 2018 and 2017. 2. Does Wizard generate sufficient net income in both years (before taxes and interest) to cover the cost of debt financing? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the times interest earned ratios for 2018 and 2017. (Round your answers to 1 decimal place.) Times Interest Year Earned

According to the producer price index database maintained by the Bureau of Labor Statistics, the average cost of computer equipment fell 3.8 percent between January and December 2018. Let's see whether these changes are reflected in the income statement of Wizard Computers for the year ended December 31, 2018. Sales Revenue Cost of Goods Sold Gross Profit Selling, General, and Administrative Expenses Interest Expense Income before Income Tax Expense Income Tax Expense Net Income Required: 2018 $ 114,000 67,000 2017 $ 141,000 77,100 47,000 63,900 37,400 39,800 640 545 8,960 2,000 23,555 6,400 $ 6,960 $ 17,155 1. Compute the times interest earned ratios for 2018 and 2017. 2. Does Wizard generate sufficient net income in both years (before taxes and interest) to cover the cost of debt financing? Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the times interest earned ratios for 2018 and 2017. (Round your answers to 1 decimal place.) Times Interest Year Earned

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Presented below is information for Chivu Company for the month of March 2020 Cost of goods sold S50,000 Salaries and wages Expense s8,000 Freight-out 7,000 Sales Revenue is0,000 Interest Expense Sales Returns and Allowances 4,000 3,000 Required: Prepare a multiple-step income statement for the month of March by completing the following Salaries and wages Expense Operating Expense Total Operating Expense
In 2021, the BowWow Company purchased 17,970 units from its supplier at a cost of $10.00 per unit. BowWow sold 16,230 units of its product in 2021 at a price of $20.00 per unit. BowWow began 2021 with $995,910 in inventory (inventory is carried at a cost of $10.00 per unit). Using this information, compute BowWow's gross profit for 2021. Record your answer rounded to the nearest dollar. Do not include a dollar sign or commas in your answer. For example, record $1,234,567.89 as 1234568. Your Answer:
Pierce Corporation has the following gross profits for 2018 and 2019: Sales = 2019 - P810,000; 2018 - P792.000. Cost of sales = 2019 - 480,000; 2018 %3D - 464,000. Gross profit = 2019 - P330,000; 2018 - P328,000. Sales price was 10% lower during 2019. The change in gross profit due to change in cost price must be:
calculate the fixed and variable components of the selling and administrative expenses by dividing the change in cost of the selling and administrative expenses between 2009 and 2010 to change in sales between 2009 and 2010 and use it to determine the fixed and variable components of the cost of the selling and administrative expenses . Saunders Corporation (amounts in millions of dollars) 2009 2010 Sales 8,296 8,871 Cost of Goods Sold (5,890) (6,290) Selling and Administrative Expenses (1,788) (1,714) Operating Income before Income Taxes 618 867
Bellingham Industries, a manufacturer of the furniture industry, had the following financial performance for the last two years as shown on their income statements below: Billingham Industries, Inc. Comparative Income Statement For the Years Ended December 31, 2021 and 2020 2021 2020 Amount Amount Sales $1,280,000 $1,180,000 Cost of goods sold 644,800 613,600 Gross profit 635,200 566,400 Selling expenses 230,500 188,800 Administrative expenses 182,500 177,000 Total operating expenses 413,000 365,800 Income from operations 222,200 200,600 Other income 77,000 70,800 Income before income tax 299,200 271,400 Income tax expense 121,600 106,200 Net income $177,600 $165,200 1. Prepare a horizontal analysis using the form provided to…
Presented below is information for Chivu Company for the month of March 2020: Cost of goods sold Salaries and wages Expense S8,000 Sales Revenue Sales Returns and Allowances s50,000 Freight-out 7,000 as0,000 Interest Expense 4,000 3,000 Required: Prepare a multiple-step income statement for the month of March by completing the following: Salaries and wages Expense Operating Expense Total Operating Expense
The Quartz Company has been taking a physical inventory every quarter in order to prepare its quarterly financial statement. The management is interested to know if they have some alternative to find an efficient way of determining the cost of ending inventory for its quarterly reports. You have been given the following information abased on which you are supposed to suggest the management something that will fulfil the requirements. The Quartz Company Partial Income Statement For the year ended Dec 31, 2020 Net Sales $655,000 CGS: Beginning Inventory 80000 Purchases, Net 575000 COGAS…
Vo Manufacturing is the biggest snowmobile manufacturer in the world. It reported the following amounts in its financial statements (in millions): 2017 2018 Net Sales Revenue $ 4, 200 $ 3,660 Cost of Goods Sold 3,470 2,950 Average Inventory 430 370 Required: 1-a. Calculate the inventory turnover ratio for 2018 and 2017. 1-b. Calculate the average days to sell inventory for 2018 and 2017. 2. Did inventory turnover at Vo improve or decline in 2018? 3. Calculate the 2018 gross profit percentage. 4. The main competitor for Vo is Arctic Cat. Prior to being acquired by Textron, Incorporated, Arctic Cat reported its inventory turnover was 3.9 and its gross profit percentage was 4.5 percent. Why was Arctic Cat more likely than Vo to require a write-down for LCM/NRV? Complete this question by entering your answers in the tabs below. Req 1A Req 1B Req 2 Req 3 Req 4 Calculate the inventory turnover ratio for 2018 and 2017. (Round your answers to 1 decimal place.) Times per Year 2018 2017…
Bellingham Industries, a manufacturer of the furniture industry, had the following financial performance for the last two years as shown on their income statements below: Billingham Industries, Inc. Comparative Income Statement For the Years Ended December 31, 2021 and 2020 2021 2020 Amount Amount Sales $1,280,000 $1,180,000 Cost of goods sold 644,800 613,600 Gross profit 635,200 566,400 Selling expenses 230,500 188,800 Administrative expenses 182,500 177,000 Total operating expenses 413,000 365,800 Income from operations 222,200 200,600 Other income 77,000 70,800 Income before income tax 299,200 271,400 Income tax expense 121,600 106,200 Net income $177,600 $165,200 1. Prepare a horizontal analysis using the form provided to…
In 2021, the BowWow Company purchased 19,910 units from its supplier at a cost of $13.00 per unit. BowWow sold 10,060 units of its product in 2021 at a price of $21.00 per unit. BowWow began 2021 with $999,430 in inventory (inventory is carried at a cost of $13.00 per unit). Using this information, compute BowWow's gross profit for 2021. Record your answer rounded to the nearest dollar. Do not include a dollar sign or commas in your answer. For example, record $1,234,567.89 as 1234568.
Pierce Corporation has the following gross profits for 2018 and 2019: Sales = 2019 - P810,000; 2018 - P792,000. Cost of sales = 2019 - 480,000; 2018 - 464,000. Gross profit = 2019 - P330,000; 2018 - P328,000. Sales price was 10% lower during 2019. The decrease in gross profit due to decrease in selling price must be: