Financial and Managerial Accounting C:Please complete the attached assignment, please add your answers to the same MS Word file, some questions required full details on how to get the answer or it may need some explanation, so please ensure you full fill all the requirements.

Challenge Exercise 18-1 Expands on: E18-2 LO: 1 Operating data for Poll Corporation are presented below. 2017 2016 Net sales $800,000 $750,000 Cost of goods sold 570,000 450,000 Selling expenses 140,000 90,000 Administrative expenses 80,000 60,000 Income tax expense 53,000 40,000 Net income 77,000 70,000 Instructions: (a) Prepare a schedule showing a vertical analysis for 2017 and 2016. (b) What is the primary use of vertical analysis? (c) What does the schedule from part (a) tell you about Poll? Copyright 2015 John Wiley & Sons, Inc.Weygandt, Accounting Principles, 12/e, Challenge Exercises (For Instructor Use Only) Page 18-1 Challenge Exercise 18-2 Expands on: E18-11 LO: 2 Mulder Corporation's comparative balance sheets are presented below. MULDER CORPORATION Balance Sheets December 31 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. Instructions Compute the following ratios for 2017. (a) Current ratio. (b) Acid-test ratio. (c) Accounts receivable turnover and average collection period. (d) Inventory turnover and days in inventory. (e) Profit margin. (f) Asset turnover. (g) Return on assets. (h) Return on common stockholders' equity. (i) Earnings per share. (j) Payout ratio. (k) Debt to assets ratio. CE 22-1 Joyful Journeys Music School provides private music lessons for elementary students. Its operating costs are as follows: Rent on facilities $2,200 per month Copyright 2015 John Wiley & Sons, Inc.Weygandt, Accounting Principles, 12/e, Challenge Exercises (For Instructor Use Only) Page 18-2 Advertising Instrument Rent Teaching Instruction Books Other Costs $274 per month $750 per month $40 per student $5 per student $3 per student Joyful Journeys charges $120 per student per month. Instructions (a) Determine the company's break-even point in (1) number of students taught per month and (2) dollars. (b) Joyful Journeys has just received notice that the rent on their facilities will be increasing by $500 per month and the instrument rent will also be increasing $20 per month. (1) Determine the company's break-even point in the number of students taught per month based on the new information. (2) Determine the amount to charge per student assuming that Joyful Journeys does not increase the number of students taught. CE 22-2 Birchfield Company reports the following operating results for the month of February: sales $900,000 (units 15,000); variable costs $472,500; and fixed costs $202,500. Management is considering the following independent courses of action to increase net income. 1. 2. Increase selling price by 3.5% with no change in total variable costs or units sold. Reduce variable costs to 48% of sales. Instructions (a) Compute the net income to be earned under each alternative. Which course of action will produce the highest net income? (b) Birchfield's management is looking at longer term solutions to improve net income. One of the options they have reviewed will increase fixed expenses by $27,500 while reducing variable expenses by $2 per unit. Management feels that with these changes the price of the product could be reduced by $1 per unit. The decrease in price will then result in an increase in unit sales of 5%. Compute the net income to be earned under this alternative. Do you recommend this option? Why or why not? Chapter Twenty Three CE 23-1 Martin Company expects to have a cash balance of $135,000 on January 1, 2017. Relevant monthly budget data for the first 2 months of 2017 are as follows: Collections from customers: January $246,500, February $435,000. Payments for direct materials: January $155,000, February $240,000 Direct labor: January $90,000, February $135,000. Wages are paid in the month they are incurred. Copyright 2015 John Wiley & Sons, Inc.Weygandt, Accounting Principles, 12/e, Challenge Exercises (For Instructor Use Only) Page 18-3 Manufacturing overhead: January $63,000, February $75,000. These costs include depreciation of $5,000 per month. All other overhead costs are paid as incurred. Selling and administrative expenses: January $45,000, February $60,000. These costs are exclusive of depreciation. They are paid as incurred. Sales of marketable securities in January are expected to realize $36,000 in cash. Martin Company has a line of credit at the local bank that enables it to borrow up to $75,000. The company wants to maintain a minimum monthly cash balance of $60,000. Instructions (a) Prepare a cash budget for January and February. (b) Martin Company's chief financial officer feels that it is important to have data for the entire quarter especially since their financial forecasts indicate some difficult economic periods in the coming year. March information has been budgeted as follows: Collections from customers: $375,000 Payments for direct materials: $206,000 Direct labor: Wages paid in March $116,000 Manufacturing overhead: $84,500. This includes the monthly depreciation of $5,000. Selling and administrative expenses: $51,600. This cost is exclusive of depreciation. Marketable securities of $50,000 can be sold if needed for additional cash. (1) Prepare a cash budget for March assuming that the company does not sell the marketable securities. (2) What is the maximum amount the company can borrow during March? Does this provide the company with an adequate ending cash balance? (3) How much does the company need to borrow if the marketable securities are sold? (4) Comment on the status of the company's cash budget for March. CE23-2 Moorcroft Company's budgeted sales and direct materials purchases are as follows: April May June Budgeted Sales $300,000 320,000 370,000 Budgeted D.M. Purchases $45,000 54,000 60,000 Moorcroft's sales are 40% cash and 60% credit. Credit sales are collected 30% in the month of sale, 40% in the month following sale, and 26% in the second month following sale; 4% are uncollectible. Moorcroft's purchases are 50% cash and 50% on account. Purchases on account are paid 40% in the month following the purchase and 60% in the second month following the purchase. Instructions (a) Prepare a schedule of expected collections from customers for June. Copyright 2015 John Wiley & Sons, Inc.Weygandt, Accounting Principles, 12/e, Challenge Exercises (For Instructor Use Only) Page 18-4 (b) Prepare a schedule of expected payments for direct materials for June. (c) Moorcroft's assistant controller suggested that Moorcroft hire a part time collector to encourage customers to pay more promptly and to reduce the amount of uncollectible accounts. Sales are still 40% cash and 60% credit but the assistant controller predicted that this would cause credit sales to be collected 30% in the month of the sale, 50% in the month following sale, and 18% in the second month following sale; 2% are uncollectible. (1) Prepare a schedule of expected collections from customers for June. How did these changes impact cash collections? Would it be worth paying the collector $1,000 per month? (d) The assistant controller also suggested that the company switch their purchases to 40% cash and 60% on account to help stretch out their cash payments. There is no additional interest charge to do this and Moorcroft is still paying their bills on time. There is no change to the company's payment pattern. (1) Prepare a schedule of expected payments for direct materials for June. How did these changes impact the cash payments for June? Copyright 2015 John Wiley & Sons, Inc.Weygandt, Accounting Principles, 12/e, Challenge Exercises (For Instructor Use Only) Page 18-5