Managerial Accounting: Tools for Business Decision Making 7e + WileyPLUS Registration Card
7th Edition
ISBN: 9781119036432
Author: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
Publisher: Wiley (WileyPLUS Products)
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Textbook Question
Chapter 13, Problem 13.5E
The current sections of Scoggin Inc.’s balance sheets at December 31, 2016 and 2017, are presented here. Scoggins net income for 2017 was $153,000.
2017 | 2016 | |
Current assets | ||
Cash | $105,000 | $ 99,000 |
Accounts receivable | 110,000 | 89,000 |
Inventory | 158,000 | 172,000 |
Prepaid expenses | 27,000 | 22,000 |
Total current assets | $400,000 | $382,000 |
Current liabilities | ||
Accrued expenses payable | $ 15,000 | $ 5,000 |
Accounts payable | 85,000 | 92,000 |
Total current liabilities | $100,000 | $ 97,000 |
Instructions
Prepare the net cash provided by operating activities section of the company’s statement of cash flows for the year ended December 31, 2017, using the indirect method.
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The current sections of Teal Mountain Inc.’s balance sheets at December 31, 2016 and 2017, are presented here. Teal Mountain Inc.’s net income for 2017 was $156,366. Depreciation expense was $27,594.
2017
2016Current assets
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$ 101,178Accounts receivable
81,760
90,958Inventory
171,696
175,784Prepaid expenses
27,594
22,484Total current assets
$388,360
$390,404Current liabilities
Accrued expenses payable
$ 15,330
$ 5,110Accounts payable
86,870
94,024Total current liabilities
$102,200
$ 99,134
Prepare the net cash provided (used) by operating activities section of the company’s statement of cash flows for the year ended December 31, 2017, using the indirect method. (Show amounts that decrease cash flow with either a - sign e.g. -15,000 or in parenthesis e.g. (15,000).)
Financial information for Powell Panther Corporation is shown below:
Powell Panther Corporation: Income Statements for Year Ending December 31 (Millions of Dollars)
2018
2017
Sales
$
1,800.0
$
1,500.0
Operating costs excluding depreciation and amortization
1,395.0
1,275.0
EBITDA
$
405.0
$
225.0
Depreciation and amortization
43.0
39.0
Earnings before interest and taxes (EBIT)
$
362.0
$
186.0
Interest
40.0
33.0
Earnings before taxes (EBT)
$
322.0
$
153.0
Taxes (40%)
128.8
61.2
Net income
$
193.2
$
91.8
Common dividends
$
174.0
$
73.0
Powell Panther Corporation: Balance Sheets as of December 31 (Millions of Dollars)
2018
2017
Assets
Cash and equivalents
$
23.0
$
18.0
Accounts receivable
248.0
225.0
Inventories
396.0
360.0
Total current assets
$
667.0
$
603.0
Net plant and equipment
429.0
390.0
Total assets
$
1,096.0
$
993.0
Liabilities and Equity
Accounts…
Mulder Corporation's comparative balance sheets for year end at December 31, 2017 are presented below:
2017 2016
Cash $10,300 $3,900
Accounts receivable 6,200 14,400
Inventory 11,000 8,000
Land 32,000 28,000
Buildings 74,000 74,000
Accumulated depreciation - buildings (15,000) (12,000)
Total $118,500 $116,300
Accounts payable $17,370 31,100
Common stock ($5 par) 60,000 60,000
Retained earnings 41,130 25,200
Total $118,500 $116,300
Mulder's 2017 income statement included net sales of $140,000, cost of goods sold of $80,000 and net income of $20,000.
Compute the inventory turnover and days in inventory ratio for 2017.
Chapter 13 Solutions
Managerial Accounting: Tools for Business Decision Making 7e + WileyPLUS Registration Card
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