The comparative balance sheet of House Construction Co. for June 30, 2010 and 2009, is as follows

The comparative balance sheet of House Construction Co. for June 30, 2010 and 2009, is as follows:

Assets June 30, 2010 June 30, 2009
Cash----- 41600 28200
A/R (Net) ----121900 110700
Inventories---------- 175600 170500
Investments---------- 0 60000
Land -------174000 0
Equipment---------- 258000 210600
Accumulated Depreciation--------- -58300 -49600
Total------------ 712800 530400


Liabilities & Stockholders Equity
A/P (Merchandise Creditors) ----------121000 114200
Accrued Expense Payable (Operating Expense)------------ 18000 15800
Dividends Payable--------------- 15000 12000
Common Stock, $1 Par--------------- 67200 60000
Paid-In Capital In Excess Of Par - Common Stock------- 264000 120000
Retained Earnings ------------227600 208400
Total---------- 712800 530400

The following additional information was taken from the records of House Construction Co.:

A. Equipment and land were acquired for cash.
B. There were no disposals of equipment during the year.
C. The investments were sold for $54,000 cash.
D. The common stock was issued for cash.
E. There was a $79,200 credit to Retained Earnings for net income.
F. There was a $60,000 debit to Retained Earnings for cash dividends declared.

A. Prepare a statement of cash flows, using the indirect method of presenting cash flows from operating activities.

B. Prepare ratios as required

Check: Net Cash Flow from Operating Activities $86,600

Click here for the solution: The comparative balance sheet of House Construction Co. for June 30, 2010 and 2009, is as follows

(Softech Canvas Goods) Comparative balance sheets for Softech Canvas Goods for 2011 and 2010 are shown below

E 18-24 Profitability ratio

Comparative balance sheets for Softech Canvas Goods for 2011 and 2010 are shown below. Softech pays no dividends, and instead reinvests all earnings for future growth.

Comparative Balance sheets ($in 000s)
December 31
2011 2010
Assets:
Cash $ 50 $40
Accounts receivable 100 120
Short-term investment 50 40
Inventory 200 140
Property, plant, and equipment (net) 600 550
$1,000 $890
Liabilities and Shareholder’s Equity:
Current liabilities $240 $210
Bonds payable 160 160
Paid-in Capital 400 400
Retained earnings 200 120
$1,000 $890

Required:
1. Determine the return on shareholders' equity for 2011.
2. What does the ratio measure?

Click here for the solution: Comparative balance sheets for Softech Canvas Goods for 2011 and 2010 are shown below

(Surmise Company) The comparative balance sheets for 2011 and 2010 are given below for Surmise Company

P 21-14 Statement of cash flows; indirect method; limited information

The comparative balance sheets for 2011 and 2010 are given below for Surmise Company. Net income for 2011 was $50 million.

Surmise Company
Comparative Balance sheets
December 31, 2011 and 2010
($In millions)
2011 2010
Assets
Cash $45 $40
Accounts receivable 92 96
Less: Allowance for uncollectible accounts (12) (4)
Prepaid expense 8 5
Inventory 145 130
Long-term investment 80 40
Land 100 100
Buildings and equipment 411 300
Less: Accumulated depreciation (142) (120)
Patent 16 17
$743 $604
Liabilities
Account payable $17 $32
Accrued liabilities (2) 10
Notes payable 35 0
Lease liability 111 0
Bonds payable 65 125
Shareholder’s equity
Common Stock 60 50
Paid-in capital-excess of par 245 205
Retained earnings 212 182
$743 $604

Required:
Prepare the statement of cash flows of Surmise Company for the year ended December 31, 2011. Use the indirect method to present cash flows from operating activities because you do not have sufficient information to use the direct method. You will need to make reasonable assumptions concerning the reasons for change in some account balances. A spreadsheet or T-account analysis will be helpful.

Click here for the solution: The comparative balance sheets for 2011 and 2010 are given below for Surmise Company

The comparative balance sheets for 2011 and 2010 and the income statement for 2011 are given below for Arduous Company

P 21-11 Prepare a statement of cash flows; direct method

The comparative balance sheets for 2011 and 2010 and the income statement for 2011 are given below for Arduous Company. Additional information from Arduous's accounting records is provided also.

AND SO ON

Additional information from the accounting records:
a. During 2011, $6 million of customer accounts were written off as uncollectible.
b. Investment revenue includes Arduous Company's $6 million share of the net income of Demur Company, an equity method investee.
c. Treasury bills were sold during 2011 at a gain of $2 million. Arduous Company classifies its investments in Treasury bills as cash equivalents.
d. A machine originally costing $70 million that was one-half depreciated was rendered unusable by a rare flood. Most major components of the machine were unharmed and were sold for $17 million.
e. Temporary differences between pretax accounting income and taxable income caused the deferred income tax liability to increase by $3 million.
f. The preferred stock of Tory Corporation was purchased for $25 million as a long-term investment.
g. Land costing $46 million was acquired by issuing $23 million cash and a 15%, four-year, $23 million note payable to the seller.
h. A building was acquired by a 15-year capital lease; present value of lease payments, $82 million. i. $60 million of bonds were retired at maturity. j. In February, Arduous issued a 4% stock dividend (4 million shares). The market price of the $5 par value common stock was $7.50 per share at that time.
k. In April, 1 million shares of common stock were repurchased as treasury stock at a cost of $9 million.

Required:
Prepare the statement of cash flows of Arduous Company for the year ended December 31, 2011. Present cash flows from operating activities by the direct method. (A reconciliation schedule is not required.)

Click here for the solution: The comparative balance sheets for 2011 and 2010 and the income statement for 2011 are given below for Arduous Company

An analysis of comparative balance sheets, the current year’s income statement, and the general ledger accounts of Conard Corp

An analysis of comparative balance sheets, the current year’s income statement, and the general ledger accounts of Conard Corp. uncovered the following items. Assume all items involve cash unless there is information to the contrary. Indicate how each item should be classified in the statement of cash flows using the four major classifications listed to the right.

a. Payment of interest on notes payable
b. Exchange of land for patent
c. Sale of building at book value
d. Payment of dividends
e. Depreciation
f. Receipt of dividends on investment in stock
g. Receipt of interest on notes receivable
h. Issuance of capital stock
i. Amortization of patent
j. Issuance of bonds for land
k. Purchase of land
l. Conversion of bonds into common stock
m. Loss on sale of land
n. Retirement of bonds

Click here for the solution: An analysis of comparative balance sheets, the current year’s income statement, and the general ledger accounts of Conard Corp

Armada Company has these comparative balance sheet data

Armada Company has these comparative balance sheet data:

ARMADA COMPANY
Balance Sheets
December 31
2010 2009
Cash $25,000 $ 30,000
Receivables (net) 65,000 60,000
Inventories 60,000 50,000
Plant assets (net) 200,000 180,000
$350,000 $320,000

Accounts payable $50,000 $60,000
Mortgage payable (15%) 100,000 100,000
Common stock, $10 par 140,000 120,000
Retained earnings 60,000 40,000
$350,000 $320,000
Additional information for 2010:
1. Net income was $25,000.
2. Sales on account were $375,000. Sales returns and allowances amounted to $25,000.
3. Cost of goods sold was $198,000.
4. Net cash provided by operating activities was $48,000.
5. Capital expenditures were $25,000, and cash dividends were $18,000.

Compute the following ratios at December 31, 2010.

Current Ratio
Receivables turnover times
Average collection period days
Inventory turnover times
Days in inventory days
Cash debt coverage times
Current cash debt coverage times
Free cash flow

Click here for the solution: Armada Company has these comparative balance sheet data

Here are the comparative income statements of Winfrey Corporation

E13-6 Here are the comparative income statements of Winfrey Corporation.

WINFREY CORPORATION
Comparative Income Statements
For the Years Ended December 31
2010 2009
Net sales $598,000 $520,000
Cost of goods sold 477,000 450,000
Gross profit $121,000 $ 70,000
Operating expenses 80,000 45,000
Net income $ 41,000 $ 25,000

Instructions
(a) Prepare a horizontal analysis of the income statement data for Winfrey Corporation using 2009 as a base. (Show the amounts of increase or decrease.)
(b) Prepare a vertical analysis of the income statement data for Winfrey Corporation for both years.

Click here for the solution: Here are the comparative income statements of Winfrey Corporation

The comparative balance sheets of Nike, Inc. are presented here

E13-5 The comparative balance sheets of Nike, Inc. are presented here.

NIKE, INC.
Comparative Balance Sheets
May 31
($ in millions)
Assets
2007 2006
Current assets $ 8,076 $7,346
Property, plant, and equipment (net) 1,678 1,658
Other assets 934 866
Total assets $10,688 $9,870
Liabilities and Stockholders’ Equity
Current liabilities $ 2,584 $2,612
Long-term liabilities 1,079 973
Stockholders’ equity 7,025 6,285
Total liabilities and stockholders’ equity $10,688 $9,870

Instructions
(a) Prepare a horizontal analysis of the balance sheet data for Nike using 2006 as a base. (Show the amount of increase or decrease as well.)
(b) Prepare a vertical analysis of the balance sheet data for Nike for 2007.

Click here for the solution: The comparative balance sheets of Nike, Inc. are presented here

The comparative balance sheets for 2006 and 2005 are given below for Surmise Company

The comparative balance sheets for 2006 and 2005 are given below for Surmise Company. Net Income for 2006 was $50 million.

Surmise Company Comparative Balance Sheets Dec. 31, 2006 and 2005 ($ in millions)
------------------------2006---------------------2005--------
ASSETS:
Cash $45 $40
Accounts Receivable 92 96
Less: Allowance for Uncollectible accounts (12) (4)
Prepaid expense 8 5
Inventory 145 130
Long term Investment 80 40
Land 100 100
Buildings & Equipments 411 300
less: Accumulated Depreciation (142) (120)
Patent 16 17
Total $743 $604
LIABILITIES:
Accounts Payable $17 $32
Accrued Liabilities (2) 10
Notes payable 35 0
Lease Liability 111 0
Bonds Payable 65 125
SHAREHOLDER"S EQUITY:
Common Stock $60 $50
Paid in Capital - Excess of par 245 205
Retained Earnings 212 182
Total $743 $604

REQUIRED: Prepare the statement of cash flow of Surmise Company for the year ended December 31, 2006. Use the indirect method to present cash flows from operating activities because you do not have sufficient information to use the direct method. You will need to make reasonable assumptions concerning the reasons for changes in some account balances. A spreadsheet or T-account analysis will be helpful.

Click here for the solution: The comparative balance sheets for 2006 and 2005 are given below for Surmise Company

An analysis of comparative balance sheets, the current year's income statement, and the general ledger accounts of Gagliano Corp

ACC 560 Week 9 Assignment

E13-2 An analysis of comparative balance sheets, the current year's income statement, and the general ledger accounts of Gagliano Corp. uncovered the following items. Assume all items involve cash unless there is information to the contrary.

(a) Payment of interest on notes payable.
(b) Exchange of land for patent.
(c) Sale of building at book value.
(d) Payment of dividends.
(e) Depreciation.
(f) Receipt of dividends on investment in stock.
(g) Receipt of interest on notes receivable.
(h) Issuance of capital stock.
(i) Amortization of patent.
(j) Issuance of bonds for land.
(k) Purchase of land.
(l) Conversion of bonds into common stock.
(m) Loss on sale of land.
(n) Retirement of bonds.

Instructions
Indicate how each item should be classified in the statement of cash flows using these four major classifications: operating activity (indirect method), investing activity, financing activity, and significant noncash investing and financing activity.


Click here for the solution: An analysis of comparative balance sheets, the current year's income statement, and the general ledger accounts of Gagliano Corp

Scully Corporation's comparative balance sheets are presented below

ACC 560 Week 9 Assignment

E13-7 Scully Corporation's comparative balance sheets are presented below.

SCULLY CORPORATION
Comparative Balance Sheets
December 31
2008 2007
Cash $14,300 $10,700
Accounts receivable 21,200 23,400
Land 20,000 26,000
Building 70,000 70,000
Accumulated depreciation (15,000) (10,000)
Total $110,500 $120,100

Accounts payable $12,370 $31,100
Common stock 75,000 69,000
Retained earnings 23,130 20,000
Total $110,500 $120,100

Additional information:
1. Net income was $22,630. Dividends declared and paid were $19,500.
2. All other changes in noncurrent account balances had a direct effect on cash flows, except the change in accumulated depreciation. The land was sold for $4,900.
3. Prepare a statement of cash flows for 2008 using the indirect method.


Click here for the solution: Scully Corporation's comparative balance sheets are presented below

The comparative condensed income statements of Hendi Corporation are shown below

ACC 560 Week 10 Assignment

E14-4 The comparative condensed income statements of Hendi Corporation are shown below.

HENDI CORPORATION
Comparative Condensed Income Statements
For the Years Ended December 31

2009 2008
Net sales $600,000 $500,000
Cost of goods sold 483,000 420,000
Gross profit 117,000 80,000
Operating expenses 57,200 44,000
Net income $ 59,800 $ 36,000

Instructions
a) Prepare a horizontal analysis of the income statement data for Hendi Corporation using 2008 as a base. (Show the amounts of increase or decrease.)
b) Prepare a vertical analysis of the income statement data for Hendi Corporation in columnar form for both years.


Click here for the solution: The comparative condensed income statements of Hendi Corporation are shown below

Comparative financial statement data of Danfield, Inc., follow

P15-26A Using ratios to evaluate a stock investment

Comparative financial statement data of Danfield, Inc., follow:

DANFIELD, INC.
Comparative Income Statement
Years Ended December 31, 2012 and 2011
2012 2011

Net Sales $467,000 $428,000
Cost of goods sold 237,000 218,000
Gross profit $230,000 $210,000
Operating expenses 136,000 134,000
Income from operations $94, 000 $76, 000
Interest expense 9,000 10,000
Income before income tax $85,000 $66,000
Income tax expenses 24,000 27,000
Net income $61,000 $39, 000

DANFIELD, INC.
Comparative Income Statement
Years Ended December 31, 2012 and 2011
2012 2011 2010*

Current assets:
Cash $97,000 $95,000
Current recievables, net 112,000 118,000 $102,000
Inventories 145,000 163,000 203,000
Prepaid expenses 12,000 5,000
Total current assets $366,000 $381,000
Property, plant, and equipment, net 211,000 179,000
Total assets $577,000 $560,000 598,000

Total current liabilities $225,000 $246,000
Total liabilities $339,000 $343,000
Preferred stock, 3% 108, 000 108,000
Common stockholders’ equity , no par 130,000 109, 000
Total liabilities and stockholders’ equity $577,000 $560,000

• Selected 2010 amounts

1. Market price of Danfield’s common stock: $86.58 at December 31, 2012, and $46.54 at December 31, 2011.
2. Common shares outstanding: 12, 000 during 2012 and 10,000 during 2011 and 2010.
3. All sales on credit.

Requirements
1. Compute the following ratios for 2012 and 2011:
a. Current ratio
b. Times-interest earned ratio
c. Inventory turnover
d. Gross profit percentage
e. Debt to equity ratio
f. Rate of return on common stockholder’s equity
g. Earnings per share of common stock
h. Price/earnings ratio
2. Decide (a) whether Danfield’s ability to pay debts and to sell inventory improved or deteriorated during 2012 and (b) whether the investment attractiveness of its common stock appears to have increased or decreased.


Click here for the solution: Comparative financial statement data of Danfield, Inc., follow

Scully Corporation's comparative balance sheets are presented below

E14-11 Scully Corporation's comparative balance sheets are presented below.

SCULLY CORPORATION
Balance Sheets
December 31
2008 2007
Cash $ 4,300 $ 3,700
Accounts receivable 21,200 23,400
Inventory 10,000 7,000
Land 20,000 26,000
Building 70,000 70,000
Accumulated depreciation (15,000) (10,000)
Total $110,500 $120,100

Accounts payable $ 12,370 $ 31,100
Common stock 75,000 69,000
Retained earnings 23,130 20,000
Total $110,500 $120,100

Scully's 2008 income statement included net sales of $100,000, cost of goods sold of $60,000, and net income of $15,000.

Instructions
Compute the following ratios for 2008. (a) Current ratio. (b) Acid-test ratio. (c) Receivables turnover. (d) Inventory turnover. (e) Profit margin. (f) Asset turnover. (g) Return on assets. (h) Return on common stockholders' equity. (i) Debt to total assets ratio.


Click here for the solution: Scully Corporation's comparative balance sheets are presented below

(Week 5 Assignment ACC 291) Here are comparative balance sheets for Taguchi Company

ACC 291 Week 5 Assignment

E13-8 Here are comparative balance sheets for Taguchi Company.

TAGUCHI COMPANY
Comparative Balance Sheets
December 31
Assets 2011 2010
Cash $ 73,000 $ 22,000
Accounts receivable 85,000 76,000
Inventories 170,000 189,000
Land 75,000 100,000
Equipment 260,000 200,000
Accumulated depreciation (66,000) (32,000)
Total $597,000 $555,000

Liabilities and Stockholders’ Equity
Accounts payable $ 39,000 $ 47,000
Bonds payable 150,000 200,000
Common stock ($1 par) 216,000 174,000
Retained earnings 192,000 134,000
Total $597,000 $555,000

Additional information:
1. Net income for 2011 was $103,000.
2. Cash dividends of $45,000 were declared and paid.
3. Bonds payable amounting to $50,000 were redeemed for cash $50,000.
4. Common stock was issued for $42,000 cash.
5. No equipment was sold during 2011, but land was sold at cost.

Instructions
Prepare a statement of cash flows for 2011 using the indirect method.

Click here for the solution: (Week 5 Assignment ACC 291) Here are comparative balance sheets for Taguchi Company

The comparative condensed balance sheets of Conard Corporation are presented below

ACC 291 Week 5 Assignment

E14-3 The comparative condensed balance sheets of Conard Corporation are presented below.

CONARD CORPORATION
Comparative Condensed Balance Sheets
December 31
Assets
Current assets $ 74,000 $ 80,000
Property, plant, and equipment (net) 99,000 90,000
Intangibles 27,000 40,000
Total assets $200,000 $210,000

Liabilities and stockholders’ equity
Current liabilities $ 42,000 $ 48,000
Long-term liabilities 143,000 150,000
Stockholders’ equity 15,000 12,000
Total liabilities and stockholders’ equity $200,000 $210,000

Instructions
1. Prepare a horizontal analysis of the balance sheet data for Conard Corporation using 2011 as a base.
2. Prepare a vertical analysis of the balance sheet data for Conard Corporation in columnar form for 2012.

Click here for the solution: The comparative condensed balance sheets of Conard Corporation are presented below

The comparative condensed income statements of Hendi Corporation are shown below

E15-4 The comparative condensed income statements of Hendi Corporation are shown below.

HENDI CORPORATION
Comparative Condensed Income Statements
For the Years Ended December 31
2009 2008
Net sales $600,000 $500,000
Cost of goods sold 483,000 420,000
Gross profit 117,000 80,000
Operating expenses 57,200 44,000
Net income $ 59,800 $ 36,000

Instructions
a) Prepare a horizontal analysis of the income statement data for Hendi Corporation using 2008 as a base. (Show the amounts of increase or decrease.)
b) Prepare a vertical analysis of the income statement data for Hendi Corporation in columnar form for both years.


Click here for the solution: The comparative condensed income statements of Hendi Corporation are shown below

The comparative balance sheet of TorMax Technology, Inc. at December 31, 2010 and 2009, is as follows

PR 16-2B The comparative balance sheet of TorMax Technology, Inc. at December 31, 2010 and 2009, is as follows

AND SO ON

Check: Net Cash Flow from Operating Activities $200,500


Click here for the solution: The comparative balance sheet of TorMax Technology, Inc. at December 31, 2010 and 2009, is as follows

The comparative balance sheet of Flack Inc for December 31, 2013 and 2012 is shown as follows

PR 16-1A The comparative balance sheet of Flack Inc for December 31, 2013 and 2012 is shown as follows:

Assets:
Dec 31, 2013 Dec 2012
Cash $234,660 $219,720
Accounts receivables 85,440 78,360
Inventories 240,660 231,420
Investments 0 90,000
Land 123,000 0
Equipment 264,420 207,420
Accumulated Depreciation-Equipment (62,400) (55,500)
885,780 771,420

Liabilities and Stockholders’ Equity
Accounts payable (merchandise creditor) 159,180 151,860
Accrued expenses payable (operations expenses) 15,840 19,740
Dividends payable 9,000 7,200
Common stock $1 par 48,000 36,000
Paid in capital excess of par-common stock 180,000 105,000
Retained earnings 473,760 451,620
885,780 771,420

The following additional information was taken from the records:
a. The investments were sold for $105,000 cash.
b. Equipment and land were acquired for cash.
c. There was no disposal of equipment during the year.
d. Common stock was issued for cash.
e. There was a $58,140 credit to retained earnings for net income.
f. There was a $36,000 debit to retained earnings for cash dividends declared.

Instructions
Prepare a statement of cash flows using the indirect method of presenting cash flows from operating activities


Click here for the solution: The comparative balance sheet of Flack Inc for December 31, 2013 and 2012 is shown as follows

The comparative balance sheets for Redwood Corporation for 2011 and 2012 follow

The comparative balance sheets for Redwood Corporation for 2011 and 2012 follow:

Balance Sheets
As of December 31
2011
Assets
Cash 40,600
Accounts Receivable 22,000
Merchandise Inventory 176,000
Prepaid Rent 4,800
Equipment 288,000
Accumulated Depreciation (236,000)
Land 80,000
Total Assets $375,400

2012
Assets
Cash 68,800
Accounts Receivable 30,000
Merchandise Inventory 160,000
Prepaid Rent 2,400
Equipment 256,000
Accumulated Depreciation (146,800)
Land 192,000
Total Assets $562,400

Liabilities
2011
Accts Payable (Inventory) 76,000
Salaries Payable 24,000

2012
Accts Payable (Inventory) 67,000
Salaries Payable 28,000
2011
Stockholders Equity
Common Stock, $25 par value 200,000
Retained Earnings 75,400
Total Liabilities and Stockholders Equity 375,400

2012
Stockholders Equity
Common Stock, $25 par value 250,000
Retained Earnings 217,400
Total Liabilities and Stockholders Equity 562,400

Income Statement
For the Year Ended December 31, 2012
Sales Revenue 1,500,000
Cost of Goods Sold (797,200)
Gross Profit 702,800
Operating Expense
Depreciation expense (22,800)
Rent expense (24,000)
Salaries expense (256,000)
Other operating expense (258,000)
Net Income $142,000

Other information
1. Purchased land for $112,000
2. Purchased new equipment for $100,000
3. Sold old equipment that cost $132,000 with accumulated depreciation of $112,000 for $20,000 cash.
4. Issued Common Stock for $50,000

Required
Prepare the statement of cash flows for 2012 using the indirect method.


Click here for the solution: The comparative balance sheets for Redwood Corporation for 2011 and 2012 follow