Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN: 9781305654174
Author: Gary A. Porter, Curtis L. Norton
Publisher: Cengage Learning
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Chapter 1, Problem 1.11E
Statement of
Ace Corporation has been in business for many years. Retained earnings on January 1, 2016, is $235,800. The following information is available for the first two months of 2016:
Required
Prepare a statement of retained earnings for the month ended February 29, 2016.
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Pharoah Company is a private camping ground near the Mount Miguel Recreation Area. It has compiled the following financial
information as of December 31, 2017.
Service revenue (from camping fees)
$198,000
Dividends
$13,500
Sales revenue (from general store)
37,500
Notes payable
75,000
Accounts payable
16,500
Expenses during 2017
189,000
Cash
12,750
Supplies
8.250
Equipment
171,000
Common stock
60.000
Retained earnings (1/1/2017)
7,500
Determine Pharoah Company's net income for 2017.
Pharoah Company's net income for 2017
$4
Computing Financial Statement Measures
The following pretax amounts are taken from the adjusted trial balance of Mastery Inc. on December 31, 2020, its annual year-end. Assume that the income tax rate for all items is 25%. The average number of common shares outstanding during the year was 20,000.
Balance, retained earnings, December 31, 2019
$ 45,000
Sales revenue
300,000
Cost of goods sold
105,000
Selling expenses
36,000
Administrative expenses
34,000
Gain on sale of investments
10,000
Unrealized holding gain on debt investments, net of tax
4,250
Prior period adjustment, understatement of depreciation from prior period (2019)
20,000
Dividends declared and paid
16,000
Required
Compute the following amounts for the year-end financial statements of 2020.
Do not use negative signs with any of your answers.
Round the per share amount to two decimal places.
Item
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a. Gross profit (2020).
b. Operating income (2020).
c. Net…
Reformulating Financial Statements For Warranty Expense
Income statement data for Whirlpool Industries from the company's 2016 financial
statements follow. Use these data to reformulate the income statement for 2014, 2015,
and 2016 under the assumption that warranty expense is a constant percentage of
revenue across all three years. Specifically, compute the adjustments to: warranty
expense, income tax expense, and net income. The company's tax rate is 30%.
12 Months Ended ($ millions) Dec. 31, 2016 Dec. 31, 2015 Dec. 31, 2014
Net sales
$26,396
$26,569
$25,550
Warranty expense
571
815
577
Compute the average warranty expense to net sales rate over the past three years.
Round answer to two decimal places (ex: 0.02345 = 2.35%)
2.5
%
Using your rounded answer, compute the adjusted warranty expense for each year.
• Round answers to one decimal place.
• Use a negative sign to indicate if the adjustment decreases an account balance.
Income Statements Adjustments
Adjusted warranty expense…
Chapter 1 Solutions
Financial Accounting: The Impact on Decision Makers
Ch. 1 - Prob. 1.1KTQCh. 1 - Prob. 1.1ECh. 1 - Prob. 1.2ECh. 1 - The Accounting Equation For each of the following...Ch. 1 - The Accounting Equation Ginger Enterprises began...Ch. 1 - The Accounting Equation Using the accounting...Ch. 1 - Changes in Owners Equity The following amounts are...Ch. 1 - The Accounting Equation For each of the following...Ch. 1 - Classification of Financial Statement Items...Ch. 1 - Classification of Financial Statement Items Regal...
Ch. 1 - Net Income (or Loss) and Retained Earnings The...Ch. 1 - Statement of Retained Earnings Ace Corporation has...Ch. 1 - Accounting Principles and Assumptions The...Ch. 1 - Prob. 1.13ECh. 1 - Prob. 1.14ECh. 1 - Prob. 1.15MCECh. 1 - Prob. 1.16MCECh. 1 - Prob. 1.1PCh. 1 - Users of Accounting Information and Their Needs...Ch. 1 - Prob. 1.3PCh. 1 - Prob. 1.4PCh. 1 - Income Statement, Statement of Retained Earnings,...Ch. 1 - Income Statement and Balance Sheet Green Bay...Ch. 1 - Prob. 1.7PCh. 1 - Statement of Retained Earnings for The Coca-Cola...Ch. 1 - Prob. 1.9PCh. 1 - Prob. 1.10MCPCh. 1 - Prob. 1.1APCh. 1 - Users of Accounting Information and Their Needs...Ch. 1 - Prob. 1.3APCh. 1 - Prob. 1.4APCh. 1 - Income Statement, Statement of Retained Earnings,...Ch. 1 - Income Statement and Balance Sheet Fort Worth...Ch. 1 - Corrected Financial Statements Heidis Bakery Inc....Ch. 1 - Statement of Retained Earnings for Brunswick...Ch. 1 - Prob. 1.9APCh. 1 - Prob. 1.10AMCPCh. 1 - Prob. 1.1DCCh. 1 - Reading and Interpreting Chipotles Financial...Ch. 1 - Comparing Two Companies in the Same Industry:...Ch. 1 - Prob. 1.5DCCh. 1 - Prob. 1.6DCCh. 1 - Prob. 1.7DC
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