Exercise 2:From the following information prepare income statement of Modern Bank for the year ended 31 atDecember 2012Loans and advances 7150000, current accounts 6600000, Interest on loans 225000, interest on cash credits105000, interest on current accounts 50000, Discount on bills 201000, interest on overdrafts 95000, interest onsaving banks 25000, interest on fixed deposits 155000,commission and exchange 44500, director fees 2500, printing 4500, salaries and allowances 72000, locker rent2000, depreciation on banks property 10000, auditor fees 5000Additional information: Rebate on bills discounted 30000, bad debts 31000, provision for taxation 72000 andloss on sale of investments 34000.

Income Statement - It is financial statement which shows the company's total expenditure and income…

Answered: Exercise 2: From the following…

Financial Accounting: The Impact on Decision Makers

10th Edition

ISBN:9781305654174

Author:Gary A. Porter, Curtis L. Norton

Publisher:Gary A. Porter, Curtis L. Norton

Chapter9: Current Liabilities, Contingencies, And The Time Value Of Money

Section: Chapter Questions

Problem 9.11MCP

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Ratio Analysis Intel Corporation provided the following information on its balance sheet and statement of cash flows: Required: 1. Calculate the (a) current ratio, (b) quick ratio, (c) cash ratio, and (d) operating cash flow ratio. ( Note: Round answers to two decimal places.) 2. CONCEPTUAL CONNECTION Interpret these results. 3. CONCEPTUAL CONNECTION Assume that Intel, as a requirement of one of its loans, must maintain a current ratio of at least 2.30. Given the large amount of cash, how could Intel accomplish this on December 31 (be specific as to dollar amounts)?
A company collects an honored note with a maturity date of 24 months from establishment, a 10% interest rate, and an initial loan amount of $30,000. Which accounts are used to record collection of the honored note at maturity date? A. Interest Revenue, Interest Expense, Cash B. Interest Receivable, Cash, Notes Receivable C. Interest Revenue, Interest Receivable, Cash, Notes Receivable D. Notes Receivable, Interest Revenue, Cash, Interest Expense
To demonstrate the difference between cash account activity and accrual basis profits (net income), note the amount each transaction affects cash and the amount each transaction affects net income. A. issued stock for cash $20,000 B. purchased supplies inventory on account $1,800 C. paid employee salaries; assume it was current days expenses $950 D. paid note payment to bank (principal only) $1,200 E. collected balance on accounts receivable $4,750
Provide journal entries to record each of the following transactions. For each, identify whether the transaction represents a source of cash (S), a use of cash (U), or neither (N). A. Paid $22,000 cash on bonds payable. B. Collected $12,600 cash for a note receivable. C. Declared a dividend to shareholders for $16,000, to be paid in the future. D. Paid $26,500 to suppliers for purchases on account. E. Purchased treasury stock for $18,000 cash.
SERIES A EXERCISES IDENTIFICATION OF OPERATING, INVESTING, AND FINANCING ACTIVITIES The following activities took place during the current year. Indicate whether each activity is a cash inflow (+) or cash outflow (), and whether it is an operating activity (O), an investing activity (I), or a financing activity (F). (a) Proceeds from collection of principal amount of loans made to borrowers (b) Cash receipts from the sale of goods (c) Payments for interest on loans (d) Payments of dividends to stockholders (e) Payments to acquire investments in debt securities (f) Dividends received on investments made in the stock of other corporations (g) Repayment of the principal on loans (h) Interest received on loans made to outside entities (i) Salaries paid to employees (j) Payments to acquire property, plant, and equipment and other productive assets (k) Payments to purchase treasury stock (l) Proceeds from the sale of common stock

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