Q: No. 2: Prepare common size analysis for the two-year period. Dugmore Company Balance Sheet December 31, 2011 and 2010 2011 2010 Assets Cash Long-term investments Land, buildings, and equipment (net) Intangible assets Other assets Total assets 67,000 195,000 9,400 5.000 $ 71,000 $ 68,000 43,000 162,000 11,300 8.000 $292.300 $347.400 Liabilities Accounts payable Long-term liabilities–8% bonds Total liabilities $ 37,100 23.500 $ 60,600 $ 34,000 17.900 $ 51,900 Stockholders' Equity 6% preferred stock Common stock Additional paid-in capital Retained earnings Total stockholders' equity Total liabilities and stockholders' equity $ 7,500 50,000 46,000 183,300 $286.800 $347.400 $ 7,500 50,000 46,000 136,900 $240,400 $292.300
Q: No. 2: Prepare common size analysis for the two-year period. Dugmore Company Balance Sheet December 31, 2011 and 2010 2011 2010 Assets Cash Long-term investments Land, buildings, and equipment (net) Intangible assets Other assets Total assets 67,000 195,000 9,400 5.000 $ 71,000 $ 68,000 43,000 162,000 11,300 8.000 $292.300 $347.400 Liabilities Accounts payable Long-term liabilities–8% bonds Total liabilities $ 37,100 23.500 $ 60,600 $ 34,000 17.900 $ 51,900 Stockholders' Equity 6% preferred stock Common stock Additional paid-in capital Retained earnings Total stockholders' equity Total liabilities and stockholders' equity $ 7,500 50,000 46,000 183,300 $286.800 $347.400 $ 7,500 50,000 46,000 136,900 $240,400 $292.300
Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
Publisher:Carl Warren
Chapter9: Metric-analysis Of Financial Statements
Section: Chapter Questions
Problem 9.6E
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Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
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