3 CashAccounts Receivable0 Inventory1 Land2 Building3 Building - Accumulated depreciation4 Equipment5 Equipment - Accumulated depreciation6 Accounts Payable7 Sales Tax Payable8 Long-term Debt9 Common SharesO Retained Earnings1 Sales Revenue2 Gain on sale of equipment3 Interest Revenue4 Rent Expense5 Wages Expense6 Advertising Expense7 Other ExpensesInterest ExpenseIncome Tax Expense0 TOTALS2 REQUIRED3456789-0$$Y5166,884 $ 56,120141,145126,31474,69068,941225,000125,000450,000450,000150,000125,000305,000250,00082,00075,00084,1021,539250,000100,00060,908915,87490,1172,984280,000150,000 -290,734 -1,038,8741,06756,944569,43722,65056,9445,69411,389In good form - prepare for Y5:Income Statement (single step)Balance Sheet (not classified)Statement of Retained EarningsStatement of Cash Flow (indirect method)Y40 $10,26325,963458,96016,55936,5995,6412,589ADDITIONAL INFORMATION - For Y5Equipment was purchased for cashEquipment with a cost of $20,000and accumulated depreciation of $9,000 was soldDividends were declared and paidDepreciation expense is included in Other ExpensesLand was purchased for cash

Explanation - There are three statements of the organization which show different accounting…

Cash Accounts Receivable Inventory Land Building Building - Accumulated depreciation Equipment Equipment - Accumulated depreciation Accounts Payable Sales Tax Payable Long-term Debt Common Shares Retained Earnings Sales Revenue Gain on sale of equipment Interest Revenue Rent Expense Wages Expense Advertising Expense Other Expenses Interest Expense Income Tax Expense TOTALS REQUIRED $ es $ Y5 166,884 $ 141,145 74,690 225,000 450,000 150,000 305,000 82,000 90,117 2,984 280,000 150,000 290,734 1,038,874 1,067 56,944 569,437 22,650 56,944 5,694 11,389 In good form - prepare for Y5: Income Statement (single step) Balance Sheet (not classified) Statement of Retained Earnings Statement of Cash Flow (indirect method) 0 $ Y4 56,120 126,314 68,941 125,000 450,000 125,000 250,000 75,000 84,102 1,539 250,000 100,000 60,908 915,874 10,263 25,963 458,960 16,559 36,599 5,641 2,589 ADDITIONAL INFORMATION - For Y5 Equipment was purchased for cash Equipment with a cost of $20,000 and accumulated depreciation of $9,000 was sold Dividends were declared and paid Depreciation expense is included in Other Expenses Land was purchased for cash

Cash Accounts Receivable Inventory Land Building Building - Accumulated depreciation Equipment Equipment - Accumulated depreciation Accounts Payable Sales Tax Payable Long-term Debt Common Shares Retained Earnings Sales Revenue Gain on sale of equipment Interest Revenue Rent Expense Wages Expense Advertising Expense Other Expenses Interest Expense Income Tax Expense TOTALS REQUIRED $ es $ Y5 166,884 $ 141,145 74,690 225,000 450,000 150,000 305,000 82,000 90,117 2,984 280,000 150,000 290,734 1,038,874 1,067 56,944 569,437 22,650 56,944 5,694 11,389 In good form - prepare for Y5: Income Statement (single step) Balance Sheet (not classified) Statement of Retained Earnings Statement of Cash Flow (indirect method) 0 $ Y4 56,120 126,314 68,941 125,000 450,000 125,000 250,000 75,000 84,102 1,539 250,000 100,000 60,908 915,874 10,263 25,963 458,960 16,559 36,599 5,641 2,589 ADDITIONAL INFORMATION - For Y5 Equipment was purchased for cash Equipment with a cost of $20,000 and accumulated depreciation of $9,000 was sold Dividends were declared and paid Depreciation expense is included in Other Expenses Land was purchased for cash

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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Revenues - Cost of Goods Sold - Depreciation =EBIT - Taxes (20%) =Unlevered net income +Depreciation - Additions to Net Working Capital - Capital Expenditures =Free Cash Flow Year 0 OA. by 35% OB. by 41% OC. by 69% O D. by 55% Year 1 500,000 - 300,000 Year 2 500,000 - - 100,000 -100,000 165,000-165,000 235,000 -47,000 235,000 -47,000 Year 3 500,000 -165,000 -100,000 188,000 188,000 100,000 100,000 - 20,000 - 20,000 268,000 268,000 Visby Rides, a livery car company, is considering buying some new luxury cars. After extensive research, they come up with the above estimates of free cash flow from this project. Visby learns that a competitor is thinking of offering similar services, thus reducing Visby's sales. By how much could sales fall before the net present value (NPV) was zero, given that the cost of capital is 8%, and that cost of goods sold is 45% of revenues? 235,000 - 47,000 188,000 100,000 - 20,000 268,000
how is income tax expense calculated?
Cash $ 200,490 Sales $ 8,104,080 Debt Investments (trading) (at cost, $145,000) 157,080 Cost of Goods Sold 4,800,000 Debt Investments (long-term) 302,490 Equity Investments (long-term) 280,490 Notes Payable (short-term) 94,080 Accounts Payable 459,080 Selling Expenses 2,004,080 Investment Revenue 64,820 Land 264,080 Buildings 1,043,490 Dividends Payable 139,490 Accrued Liabilities 100,080 Accounts Receivable 439,080 Accumulated Depreciation-Buildings 152,000 Allowance for Doubtful Accounts 29,080 Administrative Expenses 901,820 Interest Expense 212,820 Inventory 600,490 Gain 81,820 Notes Payable (long-term) 903,490 Equipment 604,080 Bonds Payable 1,003,490 Accumulated Depreciation-Equipment…
For an investment to be classified as a current asset,a. the investment must be easily convertible to cash.b. the investor must intend to convert the investment to cash within one year or currentoperating cycle, whichever is longer, or use it to pay a current liability.c. both a and b must be met for the investment to be classified as a current asset.d. neither a nor b are relevant to the classification of an investment as a current asset.
Accounts Payable Accounts Receivable Accumulated Depreciation (Equip) Allowance for Doubtful Accounts Bonds Payable Cash Cash Dividends Common Stock Cost of Goods Sold Depreciation expense Equipment Interest Expense Inventory Adjusted Trial Balance 12/31/2020 Gain on Sale of Equipment Notes Payable (due 9/30/22) PIC in Excess of Par - Common PIC from Treasury Stock Preferred Stock Prepaid Rent Retained Earnings Salary Expense Sales Returns & Allowances Sales Revenue Supplies Treasury Stock Unearned Sales Revenue Utilities Expense TOTALS Debit $4,000 $12,400 $2,800 $16,400 $1,400 $50,000 $400 $4,800 $600 $4,600 $2,000 $400 $600 $2,000 Credit $9,000 $10,000 $200 $10,000 $600 $600 $600 $20,000 $1,400 $6,000 $6,400 $36,800 $800 $102,400 $102,400 Total Assets Total Current Assets Total Liabilities Total Current Liabilities Total Stockholders' Equity Total Paid-in Capital Gross Profit Income from Operations Net Income Intangible Assets
Breanna Inc. Accounts receivable$10,700Accumulated depreciation 50,800Cost of goods sold 123,000Income tax expense 8,000Cash 62,000Net sales 201,000Equipment 128,000Selling, general, and administrative expenses 32,000Common stock (8,700 shares) 90,000Accounts payable 14,300Retained earnings, 1/1/19 30,000Interest expense 5,600Merchandise inventory 38,600Long-term debt 38,000Dividends declared and paid during 2019 16,200 Item1 Time Remaining 2 hours 32 minutes 36 seconds 02:32:36 Item 1 Time Remaining 2 hours 32 minutes 36 seconds 02:32:36 The information on the following page was obtained from the records of Breanna Inc.: Accounts receivable $ 10,700 Accumulated depreciation 50,800 Cost of goods sold 123,000 Income tax expense 8,000 Cash 62,000 Net sales 201,000 Equipment 128,000 Selling, general, and administrative expenses 32,000 Common stock (8,700 shares) 90,000 Accounts payable 14,300 Retained earnings, 1/1/19…
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Dr. Cr. Cash Accounts receivable Allowance for Doubtful Accts Inventory Equipment Accumulated Depreciation Accounts Payable 65,000 28,000 7,000 12,500 60,000 12,750 23,000 6,000 35,000 38,000 21,000 Unearned Revenue Long Term Note Payable Common Stock Retained Earnings Dividends Sales Cost of goods sold Repairs expense Salaries expense Depreciation expense Insurance expense Interest income Interest expense Income tax expense Total 10,000 130,000 52,000 6,500 25,000 3,000 4,500 1,250 4,000 3,500 274,000 274,000 What is the amount of Total Assets?
Income Statement Sales 70,291,828 Cost of Goods Sold 48,872,000 Selling, general, admin 13,648,374 Depreciation 2,625,176 net interest expense 1,602,350 Federal Income Tax 1,296,000 Interest Income 3,430 Dividend income 24,000 Unrealized gain on securities 162,000 Gain on sale of equipment 31,000 net Income 2,468,358 How do you calculate Income Tax using? What are the permanent differences and the temporary differences? What is the deferred tax liability? Additional information: Tax Rate = 21% Officer's Life Insurance premiums = $6,500 Nondeductible meals and Entertainment = $25,200 Company uses Straight Line depreication for GAAP = $2,625,176 depreciation expense 2020 Company uses Double Decline Balance for Tax = $1,170,506 depreciation expense 2020
Assets Cash Accounts receivable Inventory Plant and equipment, net Investment in Buisson, S.A. Land (undeveloped) Total assets Liabilities and Stockholders Equity Accounts payable Long-term debt Stockholders equity Total liabilities and stockholders equity Joel de Paris, Incorporated Balance Sheet Joel de Paris, Incorporated Income Statement Sales Operating expenses Net operating income Interest and taxes: Interest expense Tax expense Net Income $ 119,000 204,000 1. Average operating assets 2. Margin 2. Turnover 2 ROI 3. Residual income $4,467.000 3703,460 258,540 323,000 $ 435,540 Beginning Balance % $ 130,000 349,000 574,000 867,000 390,000 254,000 1.2.572,000 1% 1383,000 952,000 1,237,000 $ 2,572,000 Ending Balance $ 136,000 483,000 479,000 The company paid dividends of $326,540 last year. The "Investment in Buisson, S.A.," on the balance sheet represents an investment in the stock of another company. The company's minimum required rate of return of 15%. 062,000 431,000 251,000 $…
Assets (in KD) Liabilities (in KD) Cash 20000 Accounts payable 80000 Accounts receivable 100000 Accrued expenses 100000 210000 Notes payables Property, Equipment, Plants 1500000 Long-term borrowings Inventory 180000 400000 Less: Amortization 50000 Total liabilities Total equity Total assets Total Liabilities and Total Equity Income statement Sales 900000 COGS 400000 Gross profit Operating expenses 200000 EBIT Interest expenses 50000 EBT Taxes 20000 Net Income The fixed asset turnover ratio can be explained as follows: (Note: Show calculation steps in the reasons box) Oa Each dinar of fixed assets is generating $0.6 in sales. Ob Each dinar of fixed assets is generating $0.62 in sales Oc Each dinar of sales is generating $0.6 in fixed assets 04 Each dinar of sales is generating $0.62 in fixed assets.
Decrease in plant and equipment $ Decrease in deferred tax asset $ Increase in accounts receivable $ Net Loss $ 122,865 587,458 15,487 65,892 109,520 215,877 Increase in inventory $ Decrease in short-term debt $ Net cash from financing activities Net cash from investing activities Net cash from operating activities