Explain whether Company L’s report shows higher or lower net sales than the Company H during the fiscal year 2016.

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Answer 1

Question

Chapter 6, Problem 2SDC

1.

To determine

Explain whether Company L’s report shows higher or lower net sales than the Company H during the fiscal year 2016.

2.

To determine

Calculate Company L’s gross profit percentage for the fiscal year 2016 and explain whether it is greater or less than the Company H and state where the consumers are likely to find lower mark-ups.

3.

To determine

Calculate the amount of purchases for the fiscal year 2016, and explain whether Company L has earned more or less amount of purchase than Company H during the fiscal year 2016.

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Required information Use the following information for the Problems below. (Algo) [The following information applies to the questions displayed below.] Lansing Company's current-year income statement and selected balance sheet data at December 31 of the current and prior years follow. LANSING COMPANY Income Statement For Current Year Ended December 31 Sales revenue Expenses Cost of goods sold Depreciation expense Salaries expense Rent expense Insurance expense Interest expense Utilities expense Net income $ 124,200 At December 31 Accounts receivable Inventory Accounts payable Salaries payable Utilities payable Prepaid insurance Prepaid rent 51,000 16,500 27,000 9,900 4,700 4,500 3,700 $ 6,900 LANSING COMPANY Selected Balance Sheet Accounts Current Year $ 6,500 2,880 5,300 1,060 400 350 400 Prior Year $ 7,600 1,990 6,400 790 250 460 270

Access the February 21, 2017, filing of the December 31, 2016, 10-K report of The Hershey Company (ticker: HSY) at SEC.gov and complete the following requirements. Required Compute or identify the following profitability ratios of Hershey for its years ending December 31, 2016, and December 31, 2015. Interpret its profitability using the results obtained for these two years. 1. Profit margin ratio (round the percent to one decimal). 2. Gross profit ratio (round the percent to one decimal). 3. Return on total assets (round the percent to one decimal). (Total assets at year-end 2014 were $5,622,870 in thousands.) 4. Return on common stockholders’ equity (round the percent to one decimal). (Total shareholders’ equity at year-end 2014 was $1,519,530 in thousands.) 5. Basic net income per common share (round to the nearest cent).

1))For the years ended December 31, 2018 of your analysis, assume all sales are on credit and then compute the following: · (a) collection period, · (b) accounts receivable turnover, · (c) inventory turnover, and · (d) days' sales in inventory. · (e) Based on your estimates, comment on the changes in the ratios from 2018 year by drawing conclusion regarding efficiency in managing inventory and in collecting receivables (Note: Comment not more than 10 lines). 2))Provide your recommendations for improving the financial condition of your company. (Note: Comment not more than 10 lines).

Answer 2

Question

Chapter 6, Problem 2SDC

1.

To determine

Explain whether Company L’s report shows higher or lower net sales than the Company H during the fiscal year 2016.

2.

To determine

Calculate Company L’s gross profit percentage for the fiscal year 2016 and explain whether it is greater or less than the Company H and state where the consumers are likely to find lower mark-ups.

3.

To determine

Calculate the amount of purchases for the fiscal year 2016, and explain whether Company L has earned more or less amount of purchase than Company H during the fiscal year 2016.

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Answer 3

Question

Chapter 6, Problem 2SDC

1.

To determine

Explain whether Company L’s report shows higher or lower net sales than the Company H during the fiscal year 2016.

2.

To determine

Calculate Company L’s gross profit percentage for the fiscal year 2016 and explain whether it is greater or less than the Company H and state where the consumers are likely to find lower mark-ups.

3.

To determine

Calculate the amount of purchases for the fiscal year 2016, and explain whether Company L has earned more or less amount of purchase than Company H during the fiscal year 2016.

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Answer 4

Question

Chapter 6, Problem 2SDC

1.

To determine

Explain whether Company L’s report shows higher or lower net sales than the Company H during the fiscal year 2016.

2.

To determine

Calculate Company L’s gross profit percentage for the fiscal year 2016 and explain whether it is greater or less than the Company H and state where the consumers are likely to find lower mark-ups.

3.

To determine

Calculate the amount of purchases for the fiscal year 2016, and explain whether Company L has earned more or less amount of purchase than Company H during the fiscal year 2016.

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Answer 5

Chapter 6, Problem 2SDC

1.

To determine

Explain whether Company L’s report shows higher or lower net sales than the Company H during the fiscal year 2016.

2.

To determine

Calculate Company L’s gross profit percentage for the fiscal year 2016 and explain whether it is greater or less than the Company H and state where the consumers are likely to find lower mark-ups.

3.

To determine

Calculate the amount of purchases for the fiscal year 2016, and explain whether Company L has earned more or less amount of purchase than Company H during the fiscal year 2016.

Answer 6

Chapter 6, Problem 2SDC

1.

To determine

Explain whether Company L’s report shows higher or lower net sales than the Company H during the fiscal year 2016.

Answer 7

Chapter 6, Problem 2SDC

1.

To determine

Explain whether Company L’s report shows higher or lower net sales than the Company H during the fiscal year 2016.

Answer 8

2.

To determine

Calculate Company L’s gross profit percentage for the fiscal year 2016 and explain whether it is greater or less than the Company H and state where the consumers are likely to find lower mark-ups.

Answer 9

2.

To determine

Calculate Company L’s gross profit percentage for the fiscal year 2016 and explain whether it is greater or less than the Company H and state where the consumers are likely to find lower mark-ups.

Answer 10

3.

To determine

Calculate the amount of purchases for the fiscal year 2016, and explain whether Company L has earned more or less amount of purchase than Company H during the fiscal year 2016.

Answer 11

3.

To determine

Calculate the amount of purchases for the fiscal year 2016, and explain whether Company L has earned more or less amount of purchase than Company H during the fiscal year 2016.

Answer 12

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Answer 13

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Answer 14

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Answer 15

Ch. 6 - Prob. 1Q Ch. 6 - If a Chicago-based company ships goods on...Ch. 6 - Define goods available for sale. How does it...Ch. 6 - Define beginning inventory and ending inventory.Ch. 6 - Describe how transportation costs to obtain...Ch. 6 - What is the main distinction between perpetual and...Ch. 6 - Why is a physical count of inventory necessary in...Ch. 6 - What is the difference between FOB shipping point...Ch. 6 - Describe in words the journal entries that are...Ch. 6 - What is the distinction between Sales Returns and...

Explain whether Company L’s report shows higher or lower net sales than the Company H during the fiscal year 2016.

Solution Summary: The author explains whether Company L's report shows higher or lower net sales than the Company H during the fiscal year 2016.

Explain whether Company L’s report shows higher or lower net sales than the Company H during the fiscal year 2016.

Calculate Company L’s gross profit percentage for the fiscal year 2016 and explain whether it is greater or less than the Company H and state where the consumers are likely to find lower mark-ups.

Calculate the amount of purchases for the fiscal year 2016, and explain whether Company L has earned more or less amount of purchase than Company H during the fiscal year 2016.

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Chapter 6 Solutions