Financial and Managerial Accounting
Financial and Managerial Accounting
7th Edition
ISBN: 9781259726705
Author: John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher: McGraw-Hill Education
Question
Chapter 1, Problem 2BTN

1.

To determine

To identify: The total amount of asset invested in A Company and in G Company..

1.

Expert Solution
Check Mark

Explanation of Solution

(a)

For A Company

The total asset invested in A Company is $290,479

As per the accounting equation the asset will always equal to the sum of liabilities and equity. This equation represents that the assets are enough to pay the dues and to the shareholders. So the amount of asset invested in a company is $290,479.

Thus, the total amount of asset is $290,479.

(b)

For G Company

The total asset invested in G Company is $147,461

As per the accounting equation the asset will always equal to the sum of liabilities and equity. This equation represents that the assets are enough to pay the dues and to the shareholders. So the amount of asset invested in a company is $147,461.

Thus, the total amount of asset is $147,461.

2.

To determine

To compute: Return on asset of A Company and G Company.

2.

Expert Solution
Check Mark

Explanation of Solution

(a)

Given,
Net income is $53,394 million.
Assets in the beginning of the year is $231,839 million
Assets at the end of the year is $290,479 million

The formula to calculate return on asset is,

    Return on assets= Net Income Average Total Assets

Substitute $53,394 million for net income, $231,839 million for assets in the beginning, $290,479 million for assets at the end.

    Return on Assets= $53,394million $231,839million+$290,479million 2 = $53,394million $261,159million =20.4%

Hence, the return on asset of A Company is 20.4%.

(b)

Given,
Net income is $16,348 million.
Assets in the beginning of the year is $129,187 million
Assets at the end of the year is $147,461 million

The formula to calculate return on asset is,

    Return on assets= Net Income Average Total Assets

Substitute $16,384 million for net income, $129,187 million for assets in the beginning, $147,461 million for assets at the end.

    Return on Assets= $16,384million $129,187million+$147,461million 2 = $16,384million $138,324million =11.8%

Hence, the return on asset of G Company is 11.8%.

3.

To determine

To compute: The total expenses of A Company and G Company.

3.

Expert Solution
Check Mark

Explanation of Solution

(a)

Given,
Net income is $53,394 million.
Revenue is $233,715 million

The formula to calculate expenses is,

    Expenses=RevenueIncome

Substitute $53,394 million for net income and $233,715 million for revenues.

    Expenses=$233,715million$53,394million =$180,321million

Hence, the expenses of A Company are $180,321 million.

(b)

Given,
Net income is $16,348 million.
Revenue is $74,989 million.

The formula to calculate expenses is,

    Expenses=RevenueIncome

Substitute $16,348 million for net income and $74,989 million for revenues.

    Expenses=$74,989million$16,348million =$58,641million

Hence, the expenses of G Company are $58,641 million.

4.

To determine

To compare: The return on asset of A Company and G Company with their competitors.

4.

Expert Solution
Check Mark

Explanation of Solution

(a)

The return on assert of A Company is more than to its competitors.

As the A Company return on asset is 20.4%, which is more than 10% the return on asset of competitors.

Thus, the performance of A Company is satisfactory.

(b)

The return on assert of G Company is more than to its competitors.

As the A Company return on asset is 11.8%, which is more than 10% the return on asset of competitors.

Thus, the performance of G Company is satisfactory.

5.

To determine

To Analyze: Analyze the performance of A Company and G Company.

5.

Expert Solution
Check Mark

Explanation of Solution

The return on assets of A Company is 20.4% which is better than the competitor and the return on asset of G Company.

The return of asset of G Company is 11.8% which is better than the competitor.

Thus, the performance of A Company is better than the G Company.

Want to see more full solutions like this?

Subscribe now to access step-by-step solutions to millions of textbook problems written by subject matter experts!

Chapter 1 Solutions

Financial and Managerial Accounting

Ch. 1 - Describe the internal role of accounting for...Ch. 1 - 7. Identify three types of services typically...Ch. 1 - Prob. 8DQCh. 1 - Prob. 9DQCh. 1 - 10. What are some accounting-related professions? Ch. 1 - Prob. 11DQCh. 1 - Prob. 12DQCh. 1 - Prob. 13DQCh. 1 - Prob. 14DQCh. 1 - Prob. 15DQCh. 1 - Prob. 16DQCh. 1 - Prob. 17DQCh. 1 - Prob. 18DQCh. 1 - Prob. 19DQCh. 1 - Prob. 20DQCh. 1 - Prob. 21DQCh. 1 - Prob. 22DQCh. 1 - Prob. 23DQCh. 1 - Prob. 24DQCh. 1 - Prob. 25DQCh. 1 - Prob. 26DQCh. 1 - Prob. 27DQCh. 1 - Define and explain return on assets.Ch. 1 - Prob. 29DQCh. 1 - Prob. 30DQCh. 1 - Prob. 31DQCh. 1 - Refer to the financial statements of Google in...Ch. 1 - Prob. 33DQCh. 1 - Prob. 1QSCh. 1 - Prob. 2QSCh. 1 - Prob. 3QSCh. 1 - Prob. 4QSCh. 1 - Prob. 5QSCh. 1 - Prob. 6QSCh. 1 - Applying the accounting equation A1 Total assets...Ch. 1 - Applying the accounting equation A1 Use the...Ch. 1 - Prob. 9QSCh. 1 - Identifying effects of transactions using...Ch. 1 - Identifying effects of transactions using...Ch. 1 - Prob. 12QSCh. 1 - Prob. 13QSCh. 1 - Identifying assets, liabilities, and equity P2...Ch. 1 - Prob. 15QSCh. 1 - Prob. 16QSCh. 1 - Prob. 17QSCh. 1 - Prob. 1ECh. 1 - Exercise 1-2 Identifying accounting users and uses...Ch. 1 - Prob. 3ECh. 1 - Prob. 4ECh. 1 - Prob. 5ECh. 1 - Prob. 6ECh. 1 - Prob. 7ECh. 1 - Exercise 1-8 Using the accounting equation A1...Ch. 1 - Exercise 1-9 Using the accounting equation...Ch. 1 - Exercise 1-10 Analysis using the accounting...Ch. 1 - Exercise 1-11 Identifying effects of transactions...Ch. 1 - Prob. 12ECh. 1 - Exercise 1-13 Identifying effects of transactions...Ch. 1 - Exercise 1-14 Analysis of return on assets A2...Ch. 1 - Prob. 15ECh. 1 - Prob. 16ECh. 1 - Exercise 1-17 preparing a balance sheet P2 Use the...Ch. 1 - Prob. 18ECh. 1 - Prob. 19ECh. 1 - Prob. 20ECh. 1 - Prob. 21ECh. 1 - Prob. 22ECh. 1 - Problem 1-1A Identifying effects of transactions...Ch. 1 - Problem 1-2A Computing missing information using...Ch. 1 - Prob. 3PSACh. 1 - Problem 1-4A preparing a statement of retained...Ch. 1 - Problem 1-5A Preparing a balances sheet P2 Use the...Ch. 1 - Problem 1-6A Preparing a statement of cash flows...Ch. 1 - Problem 1-7A Analyzing transactions and preparing...Ch. 1 - Problem 1-8.4 Analyzing effects of transactions C4...Ch. 1 - Prob. 9PSACh. 1 - Prob. 10PSACh. 1 - Prob. 11PSACh. 1 - Prob. 12PSACh. 1 - Prob. 13PSACh. 1 - Prob. 14PSACh. 1 - Prob. 1PSBCh. 1 - Problem 1-2B Computing missing information using...Ch. 1 - Problem 1-9B analyzing transactions and preparing...Ch. 1 - Prob. 4PSBCh. 1 - Problem 1-5B Preparing a balance sheet P2 Use the...Ch. 1 - Prob. 6PSBCh. 1 - Prob. 7PSBCh. 1 - Problem 1-8B Analyzing effects of transactions C4...Ch. 1 - Prob. 9PSBCh. 1 - Prob. 10PSBCh. 1 - Prob. 11PSBCh. 1 - Prob. 12PSBCh. 1 - Prob. 13PSBCh. 1 - Prob. 14PSBCh. 1 - Prob. 1SPCh. 1 - Key financial figures for Apple’s fiscal year...Ch. 1 - Prob. 2BTNCh. 1 - Prob. 3BTNCh. 1 - Prob. 4BTNCh. 1 - Prob. 5BTNCh. 1 - Prob. 6BTNCh. 1 - Prob. 7BTNCh. 1 - Prob. 8BTNCh. 1 - Prob. 9BTN
Knowledge Booster
Recommended textbooks for you
  • FINANCIAL ACCOUNTING
    Accounting
    ISBN:9781259964947
    Author:Libby
    Publisher:MCG
    Accounting
    Accounting
    ISBN:9781337272094
    Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
    Publisher:Cengage Learning,
    Accounting Information Systems
    Accounting
    ISBN:9781337619202
    Author:Hall, James A.
    Publisher:Cengage Learning,
  • Horngren's Cost Accounting: A Managerial Emphasis...
    Accounting
    ISBN:9780134475585
    Author:Srikant M. Datar, Madhav V. Rajan
    Publisher:PEARSON
    Intermediate Accounting
    Accounting
    ISBN:9781259722660
    Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
    Publisher:McGraw-Hill Education
    Financial and Managerial Accounting
    Accounting
    ISBN:9781259726705
    Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
    Publisher:McGraw-Hill Education
  • FINANCIAL ACCOUNTING
    Accounting
    ISBN:9781259964947
    Author:Libby
    Publisher:MCG
    Accounting
    Accounting
    ISBN:9781337272094
    Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
    Publisher:Cengage Learning,
    Accounting Information Systems
    Accounting
    ISBN:9781337619202
    Author:Hall, James A.
    Publisher:Cengage Learning,
    Horngren's Cost Accounting: A Managerial Emphasis...
    Accounting
    ISBN:9780134475585
    Author:Srikant M. Datar, Madhav V. Rajan
    Publisher:PEARSON
    Intermediate Accounting
    Accounting
    ISBN:9781259722660
    Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
    Publisher:McGraw-Hill Education
    Financial and Managerial Accounting
    Accounting
    ISBN:9781259726705
    Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
    Publisher:McGraw-Hill Education