Questions and Answers of International Financial Reporting And Analysis

The Szabo Company presented the following data with the 2002 financial statements:SZABO COMPANY Statements of Cash Flows Years Ended December 31, 2002, 2001, and 2000 2002 2001 2000 Increase
Consider the following data for three different companies:($000 Omitted)Owens Arrow Alpha Net cash provided (used) by:Operating activities $(2,000) $2,700 $(3,000)Investing activities (6,000) (600)
The following information was taken from the 2002 financial statements of the Jones Corporation:Accounts receivable, January 1, 2002 $ 30,000 Accounts receivable, December 31, 2002 40,000 Sales (all
The commercial loan officers did not list the dividend payout ratio as a highly significant ratio, but they indicated that the dividend payout ratio was a ratio that appeared frequently in loan
Indicate which of the following accounting policies are conservative by placing an X under Yes or No. Assume inflationary conditions exist.Conservative Yes No a.LIFO inventory ________ ________
According to the Beaver study, three current asset accounts should be paid particular attention in order to forecast financial failure. List each of these accounts and indicate whether they should be
List three popular forms of graphs used by accountants.
LIFO reserves: Lion Company Reported year for analysis, 2000 2000 net income as reported $45,000,000 2000 inventory reserve 20,000,000 1999 inventory reserve 28,000,000 2000 income taxes 14,000,000
The Kaufman Company balance sheet is shown on the next page.Requireda. Compute the debt ratio.b. Compute the debt/equity ratio.c. Compute the ratio of total debt to tangible net worth.d. Comment on
Using the Department of Commerce Quarterly Financial Report discussion in the text, answer the following:a. Could we determine the percentage of total sales income after income taxes that a
At the end of 2000, vandals destroyed your financial records. Fortunately, the controller had kept certain statistical data related to the income statement, as follows:a.Cost of goods sold was
The income statement of Rawl Company for the year ended December 31, 2000 shows:Net sales $360,000 Cost of sales 190,000 Gross profit 170,000 Selling, general, and administrative expense 80,000
The following information for Lesky Corporation covers the year ended December 31, 2000:LESKY CORPORATION Income Statement For the Year Ended December 31, 2000 Revenue:Revenues from sales $362,000
Melcher Company reported earnings per share in 2000 and 1999 of $2.00 and $1.60, respectively. In 2001 there was a 2-for-1 stock split, and the earnings per share for 2001 were reported to be $1.40.
In 2000, Jensen Company decided to change its depreciation method from units-ofproduction to straight-line. The cumulative effect of the change to the new method, prior to 2000, was to increase
You were recently hired as the assistant treasurer for Victor, Inc. Yesterday the treasurer was injured in a bicycle accident and is now hospitalized, unconscious. Your boss, Mr.Fernandes, just
List the statement on which each of the following items may appear. Choose from (A)income statement, (B) balance sheet, or (C) neither.a.Net income l.Interest payable b.Cost of goods sold m. Loss
Answer the following concerning the Almanac of Business and Industrial Financial Ratios:a. This service presents statistics for how many size categories of firms?b. Indicate the industries covered by
Brown Company earned 5.5% on sales in 2000. What further information would be needed to evaluate this result?
The following information for Gaffney Corporation covers the year ended December 31, 2000:GAFFNEY CORPORATION Income Statement For the Year Ended December 31, 2000 Revenue:Revenues from sales
Each of the following statements represents a decision made by the accountant of Growth Industries:a.A tornado destroyed $200,000 in uninsured inventory. This loss is included in the cost of goods
Uranium Mining Company, founded in 1970 to mine and market uranium, purchased a mine in 1971 for $900 million. It estimated that the uranium had a market value of $150 per ounce. By 2000, the market
The income statement of Jones Company for the year ended December 31, 2000 is shown at the top of the next page.Required a.Compute the net earnings remaining after removing nonrecurring
The income statement of Tawls Company for the year ended December 31, 2000 shows:Revenue from sales $980,000 Cost of products sold 510,000 Gross profit 470,000 Operating expenses:Selling expenses
List where each of the following items may appear. Choose from (A) income statement,(B) balance sheet, or (C) reconciliation of retained earnings.a.Dividends paid k.Unrealized exchange gains and
Which of the following would be classified as extraordinary?a.Selling expense e.Income tax expense b.Interest expense f.Loss from prohibition of red dye c.Gain on the sale of marketable securities
Describe quasi-reorganization.
DeLand Company owns 100% of Little Florida, Inc. Will DeLand Company show a minority interest on its balance sheet? Would the answer change if it owned only 60%?Will there ever be a case in which the
When would minority interest be presented on a balance sheet?
A firm, with no opening inventory, buys ten units at $6 each during the period. In which accounts might the $60 appear on the financial statements?
Explain these preferred stock characteristics:a. Accumulation of dividendsd. Callability by the corporationb. Participation in excess of stated dividend ratee. Preference in liquidationc.
Classify each of the following as a (CA) current asset, (NA) noncurrent asset, (CL) current liability, (NL) noncurrent liability, or (E) equity account. Choose the best or most frequently used
To be conservative, how should minority interest on the balance sheet be handled for primary analysis?
Classify the following as (CA) current asset, (IV) investments, (IA) intangible asset, or(TA) tangible asset:a. Land g. Toolsb. Cash h. Prepaidsc. Copyrights i. Buildingsd. Marketable securities j.
Are the following balance sheet items (A) assets, (L) liabilities, or (E) stockholders’ equity?a. Cash dividends payable k. Retained earningsb. Mortgage notes payable l. Donated capitalc.
Corvallis Corporation owns 80% of the stock of Little Harrisburg, Inc. At December 31, 2000, Little Harrisburg had the following summarized balance sheet:LITTLE HARRISBURG, INC.Balance Sheet December
Presented below is the balance sheet of McDonald Company.McDONALD COMPANY December 31, 2000 Assets Current assets:Cash (including $10,000 restricted for payment of note) $40,000 Marketable equity
Presented below is the balance sheet of Rubber Industries.RUBBER INDUSTRIES Balance Sheet For the Year Ended December 31, 2000 Assets Current assets:Cash $50,000 Marketable equity securities 19,000
Presented below is the balance sheet of Ingram Industries.INGRAM INDUSTRIES Balance Sheet June 30, 2000 Assets Current assets:Cash (including $13,000 in sinking fund for bonds payable) $ 70,000
The Sherwill statement of consolidated income is as follows:Net sales $658 Other income 8 666 Costs and expenses:Cost of products sold 418 Selling, general, and administrative expenses 196 Interest
The J.A. Appliance Company has supplied you with the following data regarding working capital and sales for the years 2001, 2000, and 1999.2001 2000 1999 Working capital$270,000 $260,000 $240,000
The following data relate to inventory for the year ended December 31, 2001. A physical inventory on December 31, 2001, indicates that 600 units are on hand and that they came from the July 1
The following data relate to inventory for the year ended December 31, 2000:Number Cost of Per Total Date Description Units Unit Cost January 1 Beginning inventory 400 $5.00 $ 2,000 March 1 Purchase
The Anne Elizabeth Corporation is engaged in the business of making toys. A high percentage of its products are sold to consumers during November and December. Therefore, retailers need to have the
The following financial data were taken from the annual financial statements of the Smith Corporation:1999 2000 2001 Current assets $ 450,000 $ 400,000 $ 500,000 Current liabilities 390,000 300,000
Current assets and current liabilities for companies R and T are summarized below:Company R Company T Current assets $400,000 $800,000 Current liabilities 200,000 400,000 Working capital$200,000
Current assets and current liabilities for companies D and E are summarized as follows:Company D Company E Current assets $400,000 $900,000 Current liabilities 200,000 700,000 Working capital$200,000
Individual transactions often have a significant impact on ratios. This problem will consider the direction of such an impact.Total Total Net Current Current Working Current Assets Liabilities
A partial balance sheet and income statement for the King Corporation are shown below and on the next page.KING CORPORATION Partial Balance Sheet December 31, 2001 Assets Current assets:Cash $ 33,493
The Depoole Company manufactures industrial products and employs a calendar year for financial reporting purposes. Items (a) through (e) present several of Depoole’s transactions during 2001. The
Information from the Greg Company’s balance sheet follows:Current assets:Cash $ 2,100,000 Marketable securities 7,200,000 Accounts receivable 50,500,000 Inventories 65,000,000 Prepaid expenses
The Jones Petro Company reports the following consolidated statement of income:Operating revenues $2,989 Costs and expenses:Cost of rentals and royalties 543 Cost of sales 314 Selling, service,
Comment on the significance of disclosing off-balance-sheet risk of accounting loss.
When examining financial statements, a footnote that describes contingencies should be reviewed closely for possible significant liabilities that are not disclosed on the face of the balance sheet.
When a firm guarantees a bank loan for a joint venture that it participates in and the joint venture is handled as an investment, then the overall potential debt position will not be obvious from the
Use Exhibit 13-8, The Institute of Management Accountants financial report.Requireda. How much was the combined change in net assets between 1997 and 1998?b. Prepare a horizontal common-size analysis
Consecutive five-year balance sheets and income statements of the Anne Gibson Corporation are shown on the next page.Requireda. Using year-end balance sheet figures, compute the following for the
Text-of-the-Quarter, Inc. (TQI) is a new retailer of accounting texts. Sales are made via contracts that provide for TQI to send the customer an accounting text each quarter for twelve quarters. The
Required Answer the following multiple-choice questions:a. A company’s current ratio is 2.2 to 1 and quick (acid-test) ratio is 1.0 to 1 at the beginning of the year. At the end of the year, the
Items (a) through (d) are based on the following information:SHARKEY CORPORATION Selected Financial Data As of December 31 2001 2000 Cash $ 8,000 $ 60,000 Marketable securities 32,000 8,000 Accounts
The following data apply to items (a) and (b). Mr. Sparks, the owner of School Supplies, Inc., wants to maintain control over accounts receivable. He understands that accounts receivable turnover
The following inventory and sales data for this year for the G. Rabbit Company are:End Beginning of Year of Year Net sales $3,150,000 Gross receivables 180,000 $160,000 Inventory 480,000 390,000 Cost
The J. Szabo Company had an average inventory of $280,000 and a cost of goods sold of$1,250,000.Required Compute the following:a. The inventory turnover in daysb. The inventory turnover
The Interpublic Group of Companies income statement from its 1998 annual report is presented in Exhibit 5-4.Requireda. Using the income statement, prepare a vertical common-size analysis for 1998,
The Interpublic Group of Companies balance sheet from its 1998 annual report is presented in Exhibit 5-4.Requireda. Using the balance sheet, prepare a vertical common-size analysis for 1998 and 1997.
The Gap Inc. statements of earnings from its 1998 annual report is presented in Exhibit 5-3.Requireda. Using the income statement, prepare a vertical common-size analysis for 1999, 1998, and 1997.
The Gap Inc. balance sheets from its 1998 annual report are presented in Exhibit 5-3.Requireda. Using the balance sheets, prepare a vertical common-size analysis for 1999 and 1998. Use total assets
You want to determine if there is a fairly recent brokerage house assessment report on a company that you are analyzing. Which reference may aid you?
You read in your local newspaper that an executive of a company that you are interested in is giving a presentation to financial analysts in New York. How could you learn the content of the
You need to research articles on a company that you are analyzing. Which source will aid you?
What is the SIC number? How can it aid in the search of a company, industry, or product?
A. B. Smith Company has guaranteed a $1,000,000 bank note for Alender Company. How would this influence the liquidity ratios of A. B. Smith Company? How should this situation be considered?
The J. Shaffer Company has an ending inventory of $360,500 and a cost of goods sold for the year of $2,100,000. It has used LIFO inventory for a number of years because of persistent
The L. Solomon Company would like to compare its days’ sales in receivables with that of a competitor, L. Konrath Company. Both companies have had similar sales results in the past, but the L.
Mr. Williams, the owner of Williams Produce, wants to maintain control over accounts receivable. He understands that days’ sales in receivables and accounts receivable turnover will give a good
The Hawk Company wants to determine the liquidity of its receivables. It has supplied you with the following data regarding selected accounts for December 31, 2000, and 1999:2000 1999 Net sales
In this problem, compute the acid-test ratio as follows:Current Assets − Inventory Current Liabilities Required Determine the cost of sales of a firm with the financial data given below:Current
Define working capital.
Describe the difference in inventories between a firm that is a trading concern and a firm that is a manufacturing concern.
In Kern’s comparative ratio analysis, the 2018 inventory turnover ratio for Century Chocolate is closest to:A . 5.07.B . 5.42.C . 5.55.Hans Annan, CFA, a food and beverage analyst, is reviewing
Using the inventory record for purchased lemon drops shown in Exhibit 4, the cost of sales for 2018 will be closest to:A . CHF 3,550.B . CHF 4,550.C . CHF 4,850.Hans Annan, CFA, a food and beverage
Ignoring any tax effect, the 2018 net realizable value reassessment for the black licorice jelly beans will most likely result in:A . an increase in gross profi t of CHF 7,775.B . an increase in
After translating Consol-Can’s December 31, 20X2 balance sheet into the parent company’s currency (US$), the translated value of retained earnings will be c losest to:A . $41 million.B . $44
In response to the board’s second question, Templeton should reply that if the change is made, the consolidated fi nancial statements for Consolidated Motors would begin to recognize:A . realized
In response to the board’s third question, Templeton should note that the change will most likely aff ect:A . the cash ratio.B . fi xed asset turnover.C . receivables turnover.
In response to the board’s fourth question, the balance sheet exposure (in C$ millions)would be closest to:A . –19.B . 148.C . 400.
When translating Acceletron’s fi nancial statements into US dollars, Redline is least likely to use an exchange rate of USD per SGD:A . 0.671.B . 0.588.C . 0.654.
Which transaction would generate foreign currency transaction exposure for Ambleu?A . Transaction 1 B . Transaction 2 C . Transaction 3
Yu’s determination regarding Transaction 2 should be based on the currency of the:A . loan.B . bank.C . borrower.
Based on Exhibit 1, what is the foreign exchange gain resulting from Transaction 3 on the December 31, 2016 fi nancial statements?A . NVK1.70 per ton B . NVK90.75 per ton C . NVK248.54 per ton
What is the best response to Question 1?A . Yes B . No, because it would reduce organic sales growth C . No, because it would reduce net price realization and mix Question 1If Ukraine’s economy
That Ambleu should disclose:A . a restatement for local infl ation.B . that assets carried at historical cost are translated at historical rates.C . the amount of foreign exchange diff erences
The amount that Ambleu should include in its December 31, 2017 revenue from Cendaró is closest to:A . NVK10.60 million.B . NVK13.25 million.C . NVK19.73 million.
The change in Ambleu’s consolidated income tax rate from 2016 to 2017 most likely resulted from a:A . decrease in Ambleu’s domestic tax rate.B . more profi table business mix in its
The cumulative translation loss recognized by Ambleu related to the patent purchase on the December 31, 2017 fi nancial statements is closest to:A . NVK0.39 million.B . NVK1.58 million C . NVK9.12
The total intangible assets on Ngcorp’s balance sheet as of December 31, 2016 are closest to:A . ₣B12.54 million.B . ₣B12.71 million.C . ₣B13.04 million.
Janssen’s translation method, total assets for Triofi nd-B translated into Triofi nd’s presentation currency as of December 31, 2016 are c losest to:A . NER1,375,000.B . NER1,380,252.C .
The translation adjustment for Triofi nd-B’s liabilities into Triofi nd’s presentation currency for the six months ended December 31, 2016 is:A . negative.B . zero.C . positive.
Janssen’s translation method, retained earnings for Triofind-B translated into Triofi nd’s presentation currency as of June 30, 2017 are closest to:A . NER150,225.B . NER170,940.C . NER172,414.
Th e functional currency for Triofi nd-A’s sale of mobile phones to a customer in Certait is the:A . Certait real.B . Norvolt euro.C . Abuelio peso.

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