Required E3-18 (Static) Analyzing the Effects of Transactions Using T-Accounts and Interpreting the Net Profit Margin Ratio as a Financial Analyst LO3-4, 3-6 [The following information applies to the questions displayed below.] Massa Company, which has been operating for three years, provides marketing consulting services worldwide for dot-com companies. You are a financial analyst assigned to report on the Massa management team's effectiveness at managing its assets efficiently. At the start of 2019 (its fourth year), Massa's T-account balances were as follows. Dollars are in thousands. Assets Cash Accounts Receivable 3,200 8,000 Long-Term Investments 6,400 Liabilities Accounts Payable Unearned Revenue Long-Term Notes Payable Stockholders' Equity Common Stock ($0.10 par value) Additional Paid-in Capital Retained Earnings Revenues Consulting Fee Revenue Interest Revenue Expenses Wages Expense Travel Expense Utilities Expense Rent Expense Transactions for 2019: a. Provided $58,000 in services to clients who paid $48,000 in cash and owed the rest on account. b. Received $5,600 cash from clients on account. c. Received $400 in cash as interest revenue on investments. d. Paid $36,000 in wages, $12,000 in travel, $7,600 in rent, and $1,600 on accounts payable. e. Received $1,600 in cash from clients in advance of services Massa will provide next year. f. Received a utility bill for $800 for 2019 services. g. Declared and immediately paid $480 in dividends to stockholders. -18 Part 4 Calculate the net profit margin ratio for 2019. (Round your answer to 2 decimal places.) 2,400 1,600 800 3,200 5,600 4,000
Required E3-18 (Static) Analyzing the Effects of Transactions Using T-Accounts and Interpreting the Net Profit Margin Ratio as a Financial Analyst LO3-4, 3-6 [The following information applies to the questions displayed below.] Massa Company, which has been operating for three years, provides marketing consulting services worldwide for dot-com companies. You are a financial analyst assigned to report on the Massa management team's effectiveness at managing its assets efficiently. At the start of 2019 (its fourth year), Massa's T-account balances were as follows. Dollars are in thousands. Assets Cash Accounts Receivable 3,200 8,000 Long-Term Investments 6,400 Liabilities Accounts Payable Unearned Revenue Long-Term Notes Payable Stockholders' Equity Common Stock ($0.10 par value) Additional Paid-in Capital Retained Earnings Revenues Consulting Fee Revenue Interest Revenue Expenses Wages Expense Travel Expense Utilities Expense Rent Expense Transactions for 2019: a. Provided $58,000 in services to clients who paid $48,000 in cash and owed the rest on account. b. Received $5,600 cash from clients on account. c. Received $400 in cash as interest revenue on investments. d. Paid $36,000 in wages, $12,000 in travel, $7,600 in rent, and $1,600 on accounts payable. e. Received $1,600 in cash from clients in advance of services Massa will provide next year. f. Received a utility bill for $800 for 2019 services. g. Declared and immediately paid $480 in dividends to stockholders. -18 Part 4 Calculate the net profit margin ratio for 2019. (Round your answer to 2 decimal places.) 2,400 1,600 800 3,200 5,600 4,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
![---
### Required Information
**E3-18 (Static) Analyzing the Effects of Transactions Using T-Accounts and Interpreting the Net Profit Margin Ratio as a Financial Analyst LO3-4, 3-6**
*[The following information applies to the questions displayed below.]*
Massa Company, which has been operating for three years, provides marketing consulting services worldwide for dot-com companies. You are a financial analyst assigned to report on the Massa management team's effectiveness at managing its assets efficiently. At the start of 2019 (its fourth year), Massa's T-account balances were as follows. Dollars are in thousands.
#### Assets
| Cash | Accounts Receivable |
|----------|------------------------|
| 3,200 | 8,000 |
| **Long-Term Investments** |
| | 6,400 |
#### Liabilities
| Accounts Payable | Unearned Revenue |
|--------------------------|------------------------|
| 2,400 | 5,600 |
| **Long-Term Notes Payable** |
| | 1,600 |
#### Stockholders' Equity
| Common Stock ($0.10 par value) | Additional Paid-in Capital |
|---------------------------------|-------------------------------|
| 800 | 4,000 |
| **Retained Earnings** |
| | 3,200 |
#### Revenues
| Consulting Fee Revenue | Interest Revenue |
|--------------------------------|---------------|
#### Expenses
| Wages Expense | Travel Expense |
|---------------------|--------------------|
| Utilities Expense | Rent Expense |
|---------------------|--------------------|
#### Transactions for 2019:
a. Provided $58,000 in services to clients who paid $48,000 in cash and owed the rest on account.
b. Received $5,600 cash from clients on account.
c. Received $400 in cash as interest revenue on investments.
d. Paid $36,000 in wages, $12,000 in travel, $7,600 in rent, and $1,600 on accounts payable.
e. Received $1,600 in cash from clients in advance of services Massa will provide next year.
f. Received a utility bill for $800 for 2019 services.
g. Declared and immediately paid $480 in dividends to stockholders.
### E3-18 Part 4
4. Calculate the net profit margin ratio for 2019. **(Round your answer to 2 decimal places](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F266d5c88-4132-4eca-8561-6ebd3b0393f5%2Fbaad7482-5afb-4180-a029-f29f3d71b2a6%2F8ic2nkk_processed.png&w=3840&q=75)
Transcribed Image Text:---
### Required Information
**E3-18 (Static) Analyzing the Effects of Transactions Using T-Accounts and Interpreting the Net Profit Margin Ratio as a Financial Analyst LO3-4, 3-6**
*[The following information applies to the questions displayed below.]*
Massa Company, which has been operating for three years, provides marketing consulting services worldwide for dot-com companies. You are a financial analyst assigned to report on the Massa management team's effectiveness at managing its assets efficiently. At the start of 2019 (its fourth year), Massa's T-account balances were as follows. Dollars are in thousands.
#### Assets
| Cash | Accounts Receivable |
|----------|------------------------|
| 3,200 | 8,000 |
| **Long-Term Investments** |
| | 6,400 |
#### Liabilities
| Accounts Payable | Unearned Revenue |
|--------------------------|------------------------|
| 2,400 | 5,600 |
| **Long-Term Notes Payable** |
| | 1,600 |
#### Stockholders' Equity
| Common Stock ($0.10 par value) | Additional Paid-in Capital |
|---------------------------------|-------------------------------|
| 800 | 4,000 |
| **Retained Earnings** |
| | 3,200 |
#### Revenues
| Consulting Fee Revenue | Interest Revenue |
|--------------------------------|---------------|
#### Expenses
| Wages Expense | Travel Expense |
|---------------------|--------------------|
| Utilities Expense | Rent Expense |
|---------------------|--------------------|
#### Transactions for 2019:
a. Provided $58,000 in services to clients who paid $48,000 in cash and owed the rest on account.
b. Received $5,600 cash from clients on account.
c. Received $400 in cash as interest revenue on investments.
d. Paid $36,000 in wages, $12,000 in travel, $7,600 in rent, and $1,600 on accounts payable.
e. Received $1,600 in cash from clients in advance of services Massa will provide next year.
f. Received a utility bill for $800 for 2019 services.
g. Declared and immediately paid $480 in dividends to stockholders.
### E3-18 Part 4
4. Calculate the net profit margin ratio for 2019. **(Round your answer to 2 decimal places
![### Required Information
**E3-18 (Static) Analyzing the Effects of Transactions Using T-Accounts and Interpreting the Net Profit Margin Ratio as a Financial Analyst LO3-4, 3-6**
[The following information applies to the questions displayed below.]
---
### Overview
Massa Company, which has been operating for three years, provides marketing consulting services worldwide for dot-com companies. You are a financial analyst assigned to report on the Massa management team’s effectiveness at managing its assets efficiently. At the start of 2019 (its fourth year), Massa’s T-account balances were as follows. Dollars are in thousands.
---
#### Assets
| **Assets** | **Amount (in thousands)** |
|------------------------|---------------------------|
| **Cash** | 3,200 |
| **Accounts Receivable**| 8,000 |
| **Long-Term Investments** | 6,400 |
#### Liabilities
| **Liabilities** | **Amount (in thousands)** |
|----------------------------|---------------------------|
| **Accounts Payable** | 2,400 |
| **Unearned Revenue** | 5,600 |
| **Long-Term Notes Payable**| 1,600 |
#### Stockholders' Equity
| **Stockholders' Equity** | **Amount (in thousands)** |
|-------------------------------|---------------------------|
| **Common Stock ($0.10 par value)** | 800 |
| **Additional Paid-in Capital**| 4,000 |
| **Retained Earnings** | 3,200 |
#### Revenues
| **Revenues** | **Amount (in thousands)** |
|-------------------------------|---------------------------|
| **Consulting Fee Revenue** | |
| **Interest Revenue** | |
#### Expenses
| **Expenses** | **Amount (in thousands)** |
|-------------------------------|---------------------------|
| **Wages Expense** | |
| **Travel Expense** | |
| **Utilities Expense** | |
| **Rent Expense** | |
### Transactions for 2019
a. Provided $58,000 in services to clients who paid $48,000 in cash and owed the rest on account.
b. Received $5,600 cash from clients on account.
c. Received $400 in cash as interest revenue on investments.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F266d5c88-4132-4eca-8561-6ebd3b0393f5%2Fbaad7482-5afb-4180-a029-f29f3d71b2a6%2Fug71ait_processed.png&w=3840&q=75)
Transcribed Image Text:### Required Information
**E3-18 (Static) Analyzing the Effects of Transactions Using T-Accounts and Interpreting the Net Profit Margin Ratio as a Financial Analyst LO3-4, 3-6**
[The following information applies to the questions displayed below.]
---
### Overview
Massa Company, which has been operating for three years, provides marketing consulting services worldwide for dot-com companies. You are a financial analyst assigned to report on the Massa management team’s effectiveness at managing its assets efficiently. At the start of 2019 (its fourth year), Massa’s T-account balances were as follows. Dollars are in thousands.
---
#### Assets
| **Assets** | **Amount (in thousands)** |
|------------------------|---------------------------|
| **Cash** | 3,200 |
| **Accounts Receivable**| 8,000 |
| **Long-Term Investments** | 6,400 |
#### Liabilities
| **Liabilities** | **Amount (in thousands)** |
|----------------------------|---------------------------|
| **Accounts Payable** | 2,400 |
| **Unearned Revenue** | 5,600 |
| **Long-Term Notes Payable**| 1,600 |
#### Stockholders' Equity
| **Stockholders' Equity** | **Amount (in thousands)** |
|-------------------------------|---------------------------|
| **Common Stock ($0.10 par value)** | 800 |
| **Additional Paid-in Capital**| 4,000 |
| **Retained Earnings** | 3,200 |
#### Revenues
| **Revenues** | **Amount (in thousands)** |
|-------------------------------|---------------------------|
| **Consulting Fee Revenue** | |
| **Interest Revenue** | |
#### Expenses
| **Expenses** | **Amount (in thousands)** |
|-------------------------------|---------------------------|
| **Wages Expense** | |
| **Travel Expense** | |
| **Utilities Expense** | |
| **Rent Expense** | |
### Transactions for 2019
a. Provided $58,000 in services to clients who paid $48,000 in cash and owed the rest on account.
b. Received $5,600 cash from clients on account.
c. Received $400 in cash as interest revenue on investments.
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