03 Circle the income statement accounts below. Next, compute net income Supply expense $ 8.000 Notes payable 30,000 Cost of goods sold 75.000 Sales revenue 100.000 Common stock 50,000 Dividends 2,000 04 20X1 was the first year of business. During the year, $100,000 of wage costs were incurred: 895.000 were paid in cash to employees, and the remaining $5.000 of wages will be paid to employees on January 3 of the coming year, the next payday. What account title and amount will be reported on each of the following year-end financial statements? a 20XI Income Statement Account title: Wage of b. 12/31/20X1 Balance Sheet Account title Wages of s c. 20XI Statement of Cash Flows Account title: Wages of S QS THINK ABOUT IT Are Generally Accepted Accounting Principles (GAAP) necessary? (Yes/No) Why or why not? 06 For the Coca-Cola Company listed below, complete the trend indexes for Total expenses and Net income. Record the resulting trend index in the shaded area. Use 2002 as the base year. Coca-Cola (KO) (Sin millions) Sales revenue 2005 $23,104 118% 18,232 2004 $21,962 112% 17.115 2003 $21.044 108% 16.697 BASE YEAR 2002 $19,584 1009 16,514 Total expenses $4,872 $4,847 $4,347 Net income $3.050 From 2002 to 2005 sales revenue of Coca-Cola increased by %, while expenses increased by %, resulting in an increase in net income of % Coca-Cola has done a (poor/ okay / spectacular) job of controlling expenses, resulting in a poor / okay / spectacular) net income 07 For the Coca-Cola Company, complete the common-size statements for 12/31/2002, 12/31/2003, and 12/31/2004 below. Record the resulting common-size in the shaded area provided Coca-Cola (KO) (5 in millions) Assets 12/31/2004 $31,327 12/31/2003 $27,342 12/31/2002 $24.501 12/31/2005 $29,427 100% $13,072 44% $16,355 56% $13,252 Liabilities $15,392 $12.701 $15.935 $14.090 $11,800 Stockholders Equity On 12/31/2002 this company primarily financed assets with (liabilities / stockholders' equity) and on 12/31/2005 assets were primarily financed with (Tiabilities / stockholders' equity), indicating that on 12/31/2005 this company is relying (more / less) on debt to finance assets. In the common-size balance sheel every amount is compared to or divided by In the common-size income statenient, every amount is compared to or divided by Q3 Circle the income statement accounts below. Next, compute net income Supply expense $ 8.000 Notes payable 30.000 Cost of goods sold 75.000 Sales revenue 100,000 Common stock 50,000 Dividends 2.000 04 20XI was the first year of business. During the year, 5100,000 of wage costs were incurred; 895,000 were paid in cash to employees, and the remaining $5,000 of wages will be paid to employees on January 3 of the coming year, the next payday. What account title and amount will be reported on each of the following year-end financial statements? a 20x Income Statement of 5 Account title: Wape b 12/31/20X1 Balance Sheet Account title: Wages of c. 20X1 Statement of Cash Flows Account title: Wages of Q5 THINK ABOUT IT Are Generally Accepted Accounting Principles (GAAP) necessary? (Yes/No). Why or why not? Q6 For the Coca-Cola Company listed below, complete the trend indexes for Total expenses and Net income. Record the resulting friend index in the shaded area. Use 2002 as the base year. Coca-Cola (KO) (5 in millions) Sales revenue 2005 $23,104 118% 18.232 2004 $21.962 112% 17.115 2003 $21.044 100% 16,697 BASE YEAR 2002 $19,564 100% 16,514 Total expenses $4,347 $3,050 $4,847 $4,872 Net income From 2002 to 2005 sales revenue of Coca-Cola increased by %, while expenses increased by %, resulting in an increase in net income of % Coca-Cola has done a (poor/ okay / spectacular) job of controlling expenses, resulting in a (poor / okay / spectacular) net income. Q7 For the Coca-Cola Company, complete the common-size statements for 12/31/2002, 12/31/2003, and 12/31/2004 below. Record the resulting common-site % in the shaded are provided Coca-Cola (KO) (5 in millions) Assets 12/31/2004 $31,327 12/31/2003 $27.342 2/31/2002 $24.501 $13.252 $12,701 $15,392 12/31/2005 $29,427 100% $13,072 44% $16,355 56% Liabilities $14,090 $11,800 $15,935 Stockholders Equity On 12/31/2002 this company primarily financed assets with (liabilities / stockholders' equity) and on 12/31/2005 assets were primarily financed with liabilities / stockholders' equity), indicating that on 12/31/2005 this company is relying (more / less) on debt to finance assets. In the common-size balance sheet, every amount is compared to or divided by In the common-size income statement, every amount is compared to or divided by Chapter 1 - Introduction Page 14 Interpreting and Analyzing Financial Statements de