Financial Accounting
9th Edition
ISBN: 9781259738692
Author: Libby
Publisher: MCG
expand_more
expand_more
format_list_bulleted
Videos
Question
Chapter 5, Problem 5.9P
To determine
Prepare the classified (multiple-step) consolidated statement of income for Incorporation NR for the year ended December 31, 2011.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Please need help with this question
Use the following data for Exercises E16-16, E16-17, and E16-18.
Selected data for three companies are given below. All inventory amounts are ending balances and all amounts are in millions.
Identifying differences between service, merchandising, and manufacturing companies
Using the data on the previous page, calculate total current assets for each company.
Differential Analysis for a Discontinued Product
A condensed income statement by product line for Lavonia Beverage Inc. indicated the following for Vim Cola for the past year:
Line Item Description
Amount
Sales
$237,700
Cost of goods sold
(110,000)
Gross profit
$127,700
Operating expenses
(144,000)
Operating loss
$(16,300)
It is estimated that 15% of the cost of goods sold represents fixed factory overhead costs and that 23% of the operating expenses are fixed. Because Vim Cola is only one of many products, the fixed costs will not be materially affected if the product is discontinued.
Question Content Area
a. Prepare a differential analysis dated November 2 to determine whether Vim Cola should be continued (Alternative 1) or discontinued (Alternative 2). If an amount is zero, enter "0". If required, use a minus sign to indicate a loss.
Differential AnalysisContinue (Alt. 1) or Discontinue (Alt. 2) Vim ColaNovember 2
Line Item Description
ContinueVim…
Chapter 5 Solutions
Financial Accounting
Ch. 5 - Prob. 1QCh. 5 - Prob. 2QCh. 5 - Prob. 3QCh. 5 - Explain what a material amount is.Ch. 5 - What basis of accounting (cash or accrual) does...Ch. 5 - Prob. 6QCh. 5 - Prob. 7QCh. 5 - Prob. 8QCh. 5 - Prob. 9QCh. 5 - For property, plant, and equipment, as reported on...
Ch. 5 - Briefly explain the major classifications of...Ch. 5 - Prob. 12QCh. 5 - Prob. 13QCh. 5 - Prob. 14QCh. 5 - If average total assets increase, but net income,...Ch. 5 - Prob. 2MCQCh. 5 - Prob. 3MCQCh. 5 - Prob. 4MCQCh. 5 - Prob. 5MCQCh. 5 - Prob. 6MCQCh. 5 - Prob. 7MCQCh. 5 - Prob. 8MCQCh. 5 - Prob. 9MCQCh. 5 - Prob. 10MCQCh. 5 - Prob. 5.1MECh. 5 - Prob. 5.2MECh. 5 - Prob. 5.3MECh. 5 - Prob. 5.4MECh. 5 - Determining Financial Statement Effects of Sales...Ch. 5 - Prob. 5.6MECh. 5 - Prob. 5.7MECh. 5 - Matching Players in the Accounting Communication...Ch. 5 - Prob. 5.2ECh. 5 - Finding Financial Information: Matching...Ch. 5 - Prob. 5.4ECh. 5 - Preparing a Classified Balance Sheet Campbell Soup...Ch. 5 - Prob. 5.6ECh. 5 - Preparing a Classified (Multiple-Step) Income...Ch. 5 - Prob. 5.8ECh. 5 - Prob. 5.9ECh. 5 - Prob. 5.10ECh. 5 - Prob. 5.11ECh. 5 - Stock Issuances and the Statement of Stockholders...Ch. 5 - Prob. 5.13ECh. 5 - Prob. 5.14ECh. 5 - Prob. 5.15ECh. 5 - Prob. 5.16ECh. 5 - Prob. 5.17ECh. 5 - Prob. 5.18ECh. 5 - Prob. 5.19ECh. 5 - Matching Transactions with Concepts Following are...Ch. 5 - Matching Definitions with Balance Sheet-Related...Ch. 5 - Prob. 5.3PCh. 5 - Prob. 5.4PCh. 5 - Preparing a Classified (Multiple-Step) Income...Ch. 5 - Prob. 5.6PCh. 5 - Determining and Interpreting the Effects of...Ch. 5 - Determining the Effects of Transactions on Ratios...Ch. 5 - Prob. 5.9PCh. 5 - Prob. 5.1APCh. 5 - Preparing a Statement of Stockholders' Equity...Ch. 5 - Prob. 5.3APCh. 5 - Prob. 5.4APCh. 5 - Evaluating the Impact of Transactions on Statement...Ch. 5 - Prob. 5.2CONCh. 5 - Finding Financial Information Refer to the...Ch. 5 - Finding Financial Information Refer to the...Ch. 5 - Prob. 5.3CPCh. 5 - Prob. 5.4CPCh. 5 - Prob. 5.5CPCh. 5 - Prob. 5.6CPCh. 5 - Prob. 5.7CP
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Monster Beverage Corporation (MNST) develops, markets, and sells energy and other alternative beverage brands. Brown-Forman Corporation (BF.B) manufactures and sells a wide variety of spirit and wine beverages, such as Jack Daniels. The cost of goods sold and inventory were obtained from a recent annual report for both companies as follows (in millions): a. Determine the inventory turnover for both companies. Round all calculations to one decimal place. b. Determine the number of days sales in inventory for both companies. Use 365 days and round all calculations to one decimal place. c. Interpret the difference in inventory efficiency based on the companies respective product types.arrow_forwardCost of Goods Manufactured, Income Statement W. W. Phillips Company produced 4,000 leather recliners during the year. These recliners sell for 400 each. Phillips had 500 recliners in finished goods inventory at the beginning of the year. At the end of the year, there were 700 recliners in finished goods inventory. Phillips accounting records provide the following information: Required: 1. Prepare a statement of cost of goods manufactured. 2. Compute the average cost of producing one unit of product in the year. 3. Prepare an income statement for external users.arrow_forwardCould someone help me with this pleasearrow_forward
- Differential Analysis for a Discontinued Product A condensed income statement by product line for Lavonia Beverage Inc indicated the following for Vim Cola for the past year: Sales $236,400 Cost of goods sold (110,000) Gross profit $126,400 Operating expenses (145,000) Operating loss $(18,500). It is estimated that 13% of the cost of goods sold represents fixed factory overhead costs and that 18% of the operating expenses are fixed. Because Vim Cola is only one of many products, the fixed costs will not be materially affected if the product is discontinued. a. Prepare a differential analysis dated November 2 to determine whether Vim Cola should be continued (Alternative 1) or discontinued (Alternative 2). If an amount is zero, enter "0", if required, use a minus sign to indicate a loss. Differential Analysis Continue (Alt. 1) or Discontinue (Alt. 2) Vim Cola November 2 Line Item Description Revenues Costs: Variable cost of goods sold. Variable operating expenses Fixed costs Profit…arrow_forwardDifferential Analysis Report for a Discontinued Product A condensed income statement by product line for Crown Beverage Inc. indicated the following for King Cola for the past year: Sales Cost of goods sold $235,900 (109,000) Gross profit $126,900 Operating expenses (144,000) Operating loss $(17,100) It is estimated that 15% of the cost of goods sold represents fixed factory overhead costs and that 18% of the operating expenses are fixed. Since King Cola is only one of many products, the fixed costs will not be significantly affected if the product is discontinued. < a. Prepare a differential analysis report for the proposed discontinuance of King Cola. Crown Beverage Inc. Proposal to Discontinue King Cola Differential Analysis Report Differential revenue from annual sales of King Cola: Revenue from sales Differential cost of annual sales of King Cola: Variable cost of goods sold Variable operating expenses ? 100 3_E begarrow_forwardThe financial analysis of a manufacturing company for the previous year yielded the following details: Component Net revenue Cost of goods sold Value on hand Raw material Work in process Finished goods Amount (in €). 30,000 18,000 900 1,000 1,500 The inventory turnover of the company is turns. (Enter your response rounded to two decimal places.)arrow_forward
- The following data were adapted from a recent income statement of The Bluth Company: (in millions) Sales $294,260 Operating costs: Cost of products sold $(141,240) Marketing, administrative, and other expenses (94,160) Total operating costs $(235,400) Operating income $58,860 Assume that the variable amount of each category of operating costs is as follows: (in millions) Cost of products sold $79,450 Marketing, administrative, and other expenses 38,250arrow_forwardFinancial Accountingarrow_forwardThe following data were adapted from a recent income statement of The Bluth Company: (in millions) Sales $205,290 Operating costs: Cost of products sold $(98,540) Marketing, administrative, and other expenses (65,690) Total operating costs $(164,230) Operating income $41,060 Assume that the variable amount of each category of operating costs is as follows: (in millions) Cost of products sold $55,430 Marketing, administrative, and other expenses 26,690 a. Based on the data given, prepare a variable costing income statement for Bluth, assuming that the company maintained constant inventory levels during the period.arrow_forward
- Differential Analysis for a Discontinued Product The condensed product-line income statement for Rhinebeck Company for the month of October is as follows: Rhinebeck CompanyProduct-Line Income StatementFor the Month Ended October 31 Hats Gloves Mufflers Sales $65,500 $89,200 $26,800 Cost of goods sold (26,000) (33,400) (14,000) Gross profit $39,500 $55,800 $12,800 Selling and administrative expenses (29,200) (34,000) (16,300) Operating income (loss) $10,300 $21,800 $(3,500) Fixed costs are 15% of the cost of goods sold and 44% of the selling and administrative expenses. Rhinebeck Company assumes that fixed costs would not be materially affected if the Gloves line were discontinued. a. Prepare a differential analysis dated October 31 to determine if Mufflers should be continued (Alternative 1) or discontinued (Alternative 2). If an amount is zero, enter "0". If required, use a minus sign to indicate…arrow_forwardDifferential analysis for a discontinued product A condensed income statement by product line for Lavonia Beverage Inc. indicated the following for Vim Cola for the past year: Sales $232,900 Cost of goods sold (109,000) Gross profit Operating expenses Operating loss $123,900 (144,000) $(20,100) It is estimated that 16% of the cost of goods sold represents fixed factory overhead costs and that 21% of the operating expenses are fixed. Because Vim Cola is only one of many products, the fixed costs will not be materially affected if the product is discontinued. a. Prepare a differential analysis dated November 2 to determine whether Vim Cola should be continued (Alternative 1) or discontinued (Alternative 2). If an amount is zero, enter "0". If required, use a minus sign to indicate a loss. Differential Analysis Continue (Alt. 1) or Discontinue (Alt. 2) Vim Cola November 2 Continue Discontinue Line Item Description Vim Cola Vim Cola Differential Effects (Alternative 1) (Alternative 2)…arrow_forwardComplete a and barrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Managerial Accounting: The Cornerstone of Busines...AccountingISBN:9781337115773Author:Maryanne M. Mowen, Don R. Hansen, Dan L. HeitgerPublisher:Cengage Learning
Financial And Managerial AccountingAccountingISBN:9781337902663Author:WARREN, Carl S.Publisher:Cengage Learning,
Cornerstones of Cost Management (Cornerstones Ser...AccountingISBN:9781305970663Author:Don R. Hansen, Maryanne M. MowenPublisher:Cengage Learning
Managerial Accounting: The Cornerstone of Busines...
Accounting
ISBN:9781337115773
Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:Cengage Learning
Financial And Managerial Accounting
Accounting
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:Cengage Learning,
Cornerstones of Cost Management (Cornerstones Ser...
Accounting
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Cengage Learning
Inventory management; Author: The Finance Storyteller;https://www.youtube.com/watch?v=DZhHSR4_9B4;License: Standard Youtube License