Presented below are selected balance sheet information and the income statement for Burch Company.Selected Balance Sheet InformationJan. 1Dec. 31Cash$11,400$17,500Accounts receivable8,00010,500Inventory23,50021,000Accounts payable10,00014,200Income taxes payable2,5001,300Burch CompanyIncome StatementFor the year ended December 31Sales$250,000Cost of goods sold(160,000)Depreciation expense(22,900)Other expenses(35,000)Income tax expense(12,000)Net income$20,100Required:Compute the net cash flows from operating activities using the indirect method.

The objective of this question is to calculate the net cash flows from operating activities for…

Answered: Presented below are selected balance…

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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Income statement data for Winthrop Company for two recent years ended December 31, are as follows: Current Year Previous Year Sales $516,000 $400,000 Cost of goods sold 428,400 340,000 Gross profit $87,600 $60,000 Selling expenses $26,180 $22,000 Administrative expenses 22,860 18,000 Total operating expenses $49,040 $40,000 Income before income tax $38,560 $20,000 Income tax expenses 15,400 8,000 Net income $23,160 $12,000 a. Prepare a comparative income statement with horizontal analysis, indicating the increase (decrease) for the current year when compared with the previous year. If required, round to one decimal place.
Horizontal Analysis of the Income Statement Income statement data for Winthrop Company for two recent years ended December 31 are as follows: Current Year Previous Year Sales $2,280,000 $2,000,000 Cost of merchandise sold 1,960,000 1,750,000 Gross profit $320,000 $250,000 Selling expenses $156,500 $125,000 Administrative expenses 122,000 100,000 Total operating expenses $278,500 $225,000 Income before income tax expense $41,500 $25,000 Income tax expenses 16,600 10,000 Net income $24,900 $15,000
Horizontal Analysis of the Income Statement Income statement data for Boone Company for the years ended December 31, 20Y5 and 20Y4, are as follows: 20Υ5 20Υ4 Sales $673,200 $510,000 Cost of goods sold (572,000) (440,000) Gross profit $101,200 $70,000 Selling expenses $(30,500) $(25,000) Administrative expenses (27,300) (21,000) Total operating expenses $(57,800) $(46,000) Income before income tax $43,400 $24,000 Income tax expenses (17,400) (9,600) Net income $26,000 $14,400 a. Prepare a comparative income statement with horizontal analysis, indicating the increase (decrease) for 20Y5 when compared with 20Y4. Round percentage answers to one decimal place. Boone Company Comparative Income Statement For the Years Ended December 31, 20Y5 and 20Y4 20Y5 Amount 20Y4 Amount Increase (Decrease) Amount Increase (Decrease) Percent Sales $673,200 $510,000 % Cost of goods sold (572,000) (440,000) Gross profit $101,200 $70,000 % Selling expenses $(30,500) $(25,000) Administrative expenses (27,300)…
Sellall Department Stores reported the following amounts as of its December 31 year-end: Administrative Expenses, $2,400; Cost of Goods Sold, $22,728; Income Tax Expense, $3,000; Interest Expense, $1,600; Interest Revenue, $200; General Expenses, $2,600; Net Sales, $37,880; and Delivery (freight-out) Expense, $300. Required: 1. Calculate the gross profit percentage. 2. How has Sellall performed, relative to the 24.5 percent gross profit percentage reported for Walmart in 2019? (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer.)check all that apply Sellall Department Stores earned a higher gross profit percentage than Walmart. Walmart earned a higher gross profit percentage than Sellall Department Stores. Sellall includes more mark-up in the prices it charges customers than Walmart. Walmart includes more mark-up in prices it…
The following data were extracted from the income statement of Brecca Systems Inc.: Current Year Preceding Year Sales $1,533,000 $1,377,915 Beginning inventories 150,275 135,275 Cost of goods sold 876,000 835,100 Ending inventories 124,275 150,275 a. (1). Determine for each year the inventory turnover. Round to one decimal place. Current year fill in the blank 1 Preceding year fill in the blank 2 (2). Determine for each year the number of days' sales in inventory. Assume there are 365 days in the year. Round intermediate calculations to the nearest whole dollar and final answers to one decimal place. Current year fill in the blank 3 days Preceding year fill in the blank 4 days
The net income reported on the income statement for the current year was $129,500. Depreciation recorded on store equipment for the year amounted to $21,400. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: End of Year Beginning of Year Cash $51,020 $46,430 Accounts receivable (net) 36,580 34,310 Merchandise inventory 49,950 52,230 Prepaid expenses 5,610 4,410 Accounts payable (merchandise creditors) 47,810 43,920 Wages payable 26,120 28,690 A) Prepare the Cash Flows from Operating Activities section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash out flows, cash payments, decreases in cash, or any negative adjustments.
The net income reported on the income statement for the current year was $134,400. Depreciation recorded on store equipment for the year amounted to $22,200. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: End Beginning of Year of Year Cash $53,220 $48,430 Accounts receivable (net) 38,160 35,790 Merchandise inventory 52,100 54,480 Prepaid expenses 5,850 4,600 Accounts payable (merchandise creditors) 49,870 45,810 Wages payable 27,250 29,930 a. Prepare the Cash Flows from (used for) Operating Activities section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments. Statement of Cash Flows (partial) Cash flows from operating activities: Adjustments to reconcile net income to net cash flows from (used for) operating activities: Changes in current operating assets and liabilities: Net cash flow from operating…
The net income reported on the income statement for the current year was $122,100. Depreciation recorded on store equipment for the year amounted to $20,100. Balances of the current asset and current liability accounts at the beginning and end of the year are as follows: Endof Year Beginningof Year Cash $47,010 $42,780 Accounts receivable (net) 33,710 31,610 Merchandise inventory 46,020 48,130 Prepaid expenses 5,170 4,060 Accounts payable (merchandise creditors) 44,050 40,470 Wages payable 24,070 26,440 Question Content Area a. Prepare the Cash Flows from (used for) Operating Activities section of the statement of cash flows, using the indirect method. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments.
Given the following information for Blue Bell Company for last year: Net sales (all on account) $5,200,000 Cost of goods sold 2,080,000 Interest expense 240,000 Income tax expense 280,000 Net income 420,000 Income tax rate 40% Total assets: January 1 $1,800,000 December 31 2,400,000 Shareholders' equity (all common): January 1 1,500,000 December 31 1,600,000 Current assets, December 31 700,000 Quick assets, December 31 400,000 Current liabilities, December 31 300,000 Net accounts receivable: January 1 200,000 December 31 180,000 Inventory: January 1 210,000 December 31 250,000 Refer to Exhibit 4-1. Blue Bell's debt to assets ratio December 31 was A16.7% B26.2% C42.8% D33.3%
Financial Ratios The financial statements for Jackson Enterprises (income statement, statement of owner’s equity, and balance sheet) are shown. Jackson EnterprisesIncome StatementFor Year Ended December 31, 20-- Revenue from sales: Sales $170,000 Less: Sales returns and allowances 10,000 Net sales $160,000 Cost of goods sold: Merchandise inventory, January 1, 20-- $6,800 Estimated returns inventory, January 1, 20-- 1,200 $8,000 Purchases $92,930 Less: Purchases returns and allowances $1,782 Purchases discounts 1,802 3,584 Net purchases $89,346 Add: Freight-in 945 Cost of goods purchased 90,291 Goods available for sale $98,291 Less: Merchandise inventory, Dec. 31, 20-- $9,320 Estimated returns inventory, Dec. 31, 20-- 1,180 10,500 Cost of goods sold 87,791 Gross profit…
Horizontal Analysis of the Income Statement Income statement data for Winthrop Company for two recent years ended December 31 are as follows: Current Year Previous Year Sales $660,000 $500,000 Cost of merchandise sold 554,700 430,000 Gross profit $105,300 $70,000 Selling expenses $31,720 $26,000 Administrative expenses 28,600 22,000 Total operating expenses $60,320 $48,000 Income before income tax expense $44,980 $22,000 Income tax expenses 18,000 8,800 Net income $26,980 $13,200
Income statements for Franklin Company for Year 3 and Year 4 follow: FRANKLIN COMPANY Income Statements Year 4 Year 3 Sales $ 201,300 $181, 300 Cost of goods sold 143, 600 121,600 Selling expenses 20,100 18, 100 Administrative expenses 12,500 14,500 Interest expense 3, 900 5,900 Total expenses 180, 100 160, 100 Income before taxes 21, 200 21,200 Income taxes expense 6, 400 3,600 Net income $ 14,800 $ 17,600 Required Perform a horizontal analysis, showing the percentage change in each income statement component between Year 3 and Year 4. Perform a vertical analysis, showing each income statement component as a percentage of sales for each year.

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