**Exercises**1. The following information is from Wispy Woods Golf Courses. The company runs three courses and the August income statement for each course is shown.---### Wispy Woods Golf Courses**Income Statement****For the Month Ending August 31, 2022**| | Blue Course | Black Course | Gold Course ||----------------------------|-------------|--------------|-------------|| **Revenues** | | | || Greens Fees | $62,500 | $89,000 | $42,800 || Outings | | $7,000 | $28,200 || **Total Revenue** | 72,500 | 96,000 | 71,000 || | | | || **Expenses** | | | || Landscaping | $7,800 | $14,200 | $6,400 || Wages | 43,900 | 32,600 | || Repairs and Maintenance | 3,600 | 2,600 | 4,400 || Fuel | 5,100 | 3,000 | 4,000 || Utilities | 1,800 | 2,900 | 1,950 || **Total Expenses** | 62,200 | 79,100 | 47,030 || | | | || **Operating Income** | $11,300 | $15,900 | |---- **Find the missing value for outings revenue, wages, and operating income. These cells have been shaded blue.**- **Compare the financial performance of each course.**- **Identify a limitation of analyzing the information provided.**

One crucial component of a financial statement is the income statement. It lists every expense and revenue related to that accounting year. Profit is earned by the company when revenue exceeds expenses, and loss is incurred when expenses exceed revenue.Formula: Result,b) Financial performance: Compute the operating income margin for all three courses. Operating income margin = Operating incomeRevenue × 100 Formula: Result: The operating income margin for the gold course is 33.76%, which is the highest of the three courses.It is because the gold course has the lowest overall expenses, which would account for the highest operating income margin.c) These analyses have the disadvantage of not taking into account non-operating revenue or expense. All sales-related costs are included in the net income margin. In terms of profitability analysis, net income margin is a comprehensive and conservative metric.

Business

Accounting

Greens Fees Outings Total Revenue Expenses Landscaping Wages Repairs and Maintenance Fuel Utilities Total Expenses Operating Incomel siue Course $62,500 72,500 $7,800 43,900 5,600 3,100 1,800 62,200 $11,300 Black Course $89,000 7,000 96,000 b. Compare the financial performance of each course. c. Identify a limitation of analyzing the information provided. $14,200 2,600 3,000 3,000 79,100 $15,900 Gold Course $42,800 28,200 71,000 $6,400 32,600 4,400 1,980 1,650 47,030 a. Find the missing value for outings revenue, wages, and operating income. These cells have been shaded blue.

Greens Fees Outings Total Revenue Expenses Landscaping Wages Repairs and Maintenance Fuel Utilities Total Expenses Operating Incomel siue Course $62,500 72,500 $7,800 43,900 5,600 3,100 1,800 62,200 $11,300 Black Course $89,000 7,000 96,000 b. Compare the financial performance of each course. c. Identify a limitation of analyzing the information provided. $14,200 2,600 3,000 3,000 79,100 $15,900 Gold Course $42,800 28,200 71,000 $6,400 32,600 4,400 1,980 1,650 47,030 a. Find the missing value for outings revenue, wages, and operating income. These cells have been shaded blue.

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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