Interprete the income statement. EXHIBIT 2 | American Greetings Income Statement (USD millions; Fiscal year ends Februaryof subsequent year)2011 (Est)(Ends Feb2012)200820092010Total American Greetings FiguresTotal Revenue1,6911,6361,5931,677Material, Labor, and Other Production CostsSelling, Distribution, and Marketing Expenses810713682743619508478526Administrative and General ExpensesGoodwill and Other Intangible Asset Impairments226276261258290Other operating expensesOperating Income13(6)(253)139175157Net Interest and Other Non Operating Expenses22181928Income Before Income Tax Expense(275)121156129Income Tax Expense(47)(228)396947Net Income828782(4.89)Earnings Per Share (Basic)Dividends per ShareAverage Number of Shares Outstanding (Millons)2.072.182.220.600.360.560.6046.539.540.038.50By Business UnitOperating Segment Net SalesNorth American Social Expression Products1,0961,2351,1911,215International Social Exprossion Products271254262344Retall Operations17912AG Interactive83807868Operating Segment EarningsNorth American Social Expression Products70236218148International Social Expression Products(78)172020Retail Operations(19)(35)AG Interactive(162)111414Total Revenue by Product CategoryEveryday Greeting CardsSeasonal Greeting CardsGift Packaging704764753823357369377408240221223239Other Revenue44383232All Other Products345244207176Source: Company accounts; Managomont and caso writor osimatos

EXHIBIT 2 | American Greetings Income Statement (USD millions; Fiscal year ends February of subsequent yoar) 2011 (Est) (Ends Feb 2012) 2008 2009 2010 Total American Greetings Figures Total Revenue 1,691 1,636 1,593 1,677 Material, Labor, and Other Production Costs 810 713 682 743 508 Selling, Distribution, and Marketing Expenses Administrative and General Expenses Goodwill and Other Intangible Asset Impairments 619 478 526 226 276 261 258 290 Other operating expenses Operating Income (6) (253) 139 175 157 Net Interest and Other Non Operating Expenses Income Before Income Tax Expense 18 22 (275) 19 28 129 121 156 (47) (228) Income Tax Expense 39 69 47 Net Income 82 87 82 Earnings Por Sharo (Basic) Dividends per Share (4.89) 2.07 2.18 2.22 0.60 0.36 0.56 0.60 Average Number of Shares Outstanding (MIllons) 46.5 39.5 40.0 38.50

EXHIBIT 2 | American Greetings Income Statement (USD millions; Fiscal year ends February of subsequent yoar) 2011 (Est) (Ends Feb 2012) 2008 2009 2010 Total American Greetings Figures Total Revenue 1,691 1,636 1,593 1,677 Material, Labor, and Other Production Costs 810 713 682 743 508 Selling, Distribution, and Marketing Expenses Administrative and General Expenses Goodwill and Other Intangible Asset Impairments 619 478 526 226 276 261 258 290 Other operating expenses Operating Income (6) (253) 139 175 157 Net Interest and Other Non Operating Expenses Income Before Income Tax Expense 18 22 (275) 19 28 129 121 156 (47) (228) Income Tax Expense 39 69 47 Net Income 82 87 82 Earnings Por Sharo (Basic) Dividends per Share (4.89) 2.07 2.18 2.22 0.60 0.36 0.56 0.60 Average Number of Shares Outstanding (MIllons) 46.5 39.5 40.0 38.50

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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QUESTION 1The following are extracts of the income statement and the statement of financial position forMorula Industries.STATEMENT OF INCOME FOR THE YEAR ENDED 31 DECEMBER 2019PulaSales 500,000Less Cost of sales:Opening inventory 120,000Purchases 415,000Cost of goods available for sale 535,000Closing inventory (115,000) (420,000)Gross profit 80,000Operating expenses (40,000)Net surplus for the year 40,000 STAMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2019PulaCurrent assetsInventory 115,000Receivables 133,000Bank overdraft 124,000Current LiabilitiesPayables 96,000Capital and reservesShare capital 70,000General reserve 110,000Retained profit 110,000Additional Information The receivables and payables opening balances were P50, 000 each. All sales and purchases were made on credit.Required:a. Calculate the:i. Average payment period. ii. Average age of inventory. iii. Average collection period. iv. Cash conversion cycle. b. Explain five strategies that can improve the cash conversion…
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Kincaid Company reported the following data (in millions) for the past two years:2019 2018$$$$$2801501304090$$$$$2501401103575Net revenues........................................Cost of goods sold...............................Gross profit..........................................Operating expenses..............................Operating income................................In a vertical analysis of 2019, the operating expenses percentage is closest toa. 225%.b. 69%.c. 14%.d. 32%.