Hello I have another assignment if your are able to complete. Please use the Jan- Feb numbers on the guidance report. Please let me know if you can complete this. Thank you.

Chapter 9 Exercise 3 1. Liquidity ratios. Edison, Stagg, and Thornton have the following financial information at the close of business on July 10: Edison Stagg Thornton $4,000 $2,500 $1,000 Short-Term Investments 3,000 2,500 2,000 Accounts Receivable 2,000 2,500 3,000 Inventory 1,000 2,500 4,000 Prepaid Expenses 800 800 800 Accounts Payable 200 200 200 3,100 3,100 3,100 300 300 300 3,800 3,800 3,800 Cash Notes Payable: Short-Term Accrued Payables Long-Term Liabilities a. Compute the current and quick ratios for each of the three companies. (Round calculations to two decimal places.) Which firm is the most liquid? Why? b. Suppose Thornton is using FIFO for inventory valuation and Edison is using LIFO. Comment on the comparability of information between these two companies. c. If all short-term notes payable are due on July 11 at 8 a.m., comment on each company's ability to settle its obligation in a timely manner. Chapter 9 Exercise 4 1. Computation and evaluation of activity ratios. The following data relate to Alaska Products Inc.: 20X5 20X4 Net Credit Sales $832,000 $760,000 Cost of Goods Sold 440,000 350,000 Cash, Dec. 31 125,000 110,000 Accounts Receivable, Dec. 31 180,000 140,000 70,000 50,000 115,000 108,000 Inventory, Dec. 31 Accounts Payable, Dec. 31 2. The company is planning to borrow $300,000 via a 90-day bank loan to cover short-term operating needs. a. Compute the accounts-receivable and inventory-turnover ratios for 20X5. Alaska rounds all calculations to two decimal places. b. Study the ratios from part (a) and comment on the company's ability to repay a bank loan in 90 days. c. Suppose that Alaska's major line of business involves the processing and distribution of fresh and frozen fish throughout the United States. Do you have any concerns about the company's inventory-turnover ratio? Briefly discuss. Chapter 9 Problem 1 1. Horizontal and vertical analysis. The following financial statements pertain to Waterloo Corporation: WATERLOO CORPORATION Comparative Balance Sheets December 31,20X5 and 20X4 20X5 Assets 20X4 Current Assets Cash $ 11,250 $ 12,500 Accounts Receivable (net) 18,500 25,000 Inventories 38,500 35,000 __3,750 __3,750 $ 72,000 $ 76,250 $ 102,750 $ 101,250 Equipment (net) 28,500 30,000 Vehicles (net) 32,000 40,000 $ 163,250 $ 171,250 __$ 14,750 __$ 2,500 $ 250,000 $ 250,000 Prepaid Expense Total Current Assets Property, Plant, and Equipment Buildings (net) Total Property, Plant, and Equipment Trademarks (net) Total assets Liabilities and Stockholders' Equity Current Liabilities Accounts Payable Notes Payable $ 49,000 $ 70,000 13,500 40,000 Federal Taxes Payable __2,500 __25,000 Total Current Liabilities $ 65,000 $ 135,000 __$ 50,000 __$ 25,000 $ 115,000 $ 160,000 $ 25,000 $ 25,000 Retained Earnings __110,000 __65,000 Total Stockholders' Equity $ 135,000 $ 90,000 Total Liabilities and Stockholders' Equity $ 250,000 $ 250,000 Long-Term Debt Total Liabilities Stockholders' Equity Common Stock, $10 par WATERLOO CORPORATION Comparative Income Statements For the Years Ending December 31, 20X5 and 20X4 20X5 20X4 Net Sales $ 550,000 $500,000 Cost of Goods Sold __330,000 __250,000 Gross Profit $ 220,000 $250,000 Operating Expense __132,500 __100,000 Income Before Interest and Taxes $ 87,500 $150,000 Interest Expense __12,500 __3,000 Income Before Taxes $ 75,000 $147,000 Income Tax Expense __30,000 __58,800 Net Income $ 45,000 $ 88,200 Instructions a. Prepare a horizontal analysis of the balance sheet, showing dollar and percentage changes. Round all calculations in parts (a) and (b) to two decimal places. b. Prepare a vertical analysis of the income statement by relating each item to net sales. c. Briefly comment on the results of your analysis. Chapter 9 Problem 2 2. Ratio computation. The financial statements of the Lone Pine Company follow. LONE PINE COMPANY Comparative Balance Sheets December 31, 20X2 and 20X1 ($000 Omitted) 20X2 Assets 20X1 Current Assets Cash and Short-Term Investments $ 400 $ 600 3,000 2,400 __2,000 __2,200 $5,400 $5,200 $1,700 $ 600 __1,500 __1,000 Total Property, Plant, and Equipment $3,200 $1,600 Total Assets $8,600 $6,800 Accounts Receivable (net) Inventories Total Current Assets Property, Plant, and Equipment Land Buildings and Equipment (net) Liabilities and Stockholders' Equity Current Liabilities Accounts Payable Notes Payable Total Current Liabilities $1,800 $1,700 __1,100 __1,900 $2,900 $3,600 Long-Term Liabilities Bonds Payable 4,100 2,100 $7,000 $5,700 $ 200 $ 200 Retained Earnings __1,400 __900 Total Stockholders' Equity $1,600 $1,100 Total Liabilities and Stockholders' Equity $8,600 $6,800 Total Liabilities Stockholders' Equity Common Stock LONE PINE COMPANY Statement of Income and Retained Earnings For the Year Ending December 31,20X2 ($000 Omitted) Net Sales* Less: Cost of Goods Sold $36,000 $20,000 Selling Expense 6,000 Administrative Expense 4,000 Interest Expense 400 Income Tax Expense __2,000 _32,400 Net Income $ 3,600 Retained Earnings, Jan. 1 ___900 $ 4,500 Cash Dividends Declared and Paid __3,100 Retained Earnings, Dec. 31 $ 1,400 *All sales are on account. Instructions Compute the following items for Lone Pine Company for 20X2, rounding all calculations to two decimal places when necessary: a. Quick ratio b. Current ratio c. Inventory-turnover ratio d. Accounts-receivable-turnover ratio e. Return-on-assets ratio f. Net-profit-margin ratio g. Return-on-common-stockholders' equity h. Debt-to-total assets i. Number of times that interest is earned j. Dividend payout rate Chapter 9 Problem 3 3. Financial statement construction via ratios. Incomplete financial statements of Lock Box Inc. are presented as follows: LOCK BOX INC. Income Statement For the Year Ending December 31, 20X3 Sales $ Cost of Goods Sold ? ? Gross Profit $ 15,000,000 Operating Expenses and Interest Income Before Taxes ? $ Income taxes, 40% ? ? Net income $ ? LOCK BOX INC. Balance Sheet December 31, 20X3 Assets Cash $ ? Accounts Receivable ? Inventory ? Property, Plant, and Equipment Total assets ___8,000,000 $ 24,000,000 Liabilities and Stockholders' Equity Accounts Payable Notes Payable: Short-Term $ ? 600,000 Bonds Payable 4,600,000 Common Stock 2,000,000 Retained Earnings Total Liabilities and Stockholders' Equity ? $ 24,000,000 Further information is the following: Cost of goods sold is 60% of sales. All sales are on account. The company's beginning inventory is $5 million; inventory-turnover ratio is 4. The debt-to-total-assets ratio is 70%. The profit margin on sales is 6%. The firm's accounts-receivable-turnover ratio is 5. Receivables increased by $400,000 during the year. Instructions Using the preceding data, complete the income statement and the balance sheet. Ashford University ACC205 Guidance Report Week Five LISTEN TO AUDIO/VIDEO EXPLAINING THE GUIDANCE REPORT YELLOW INDICATES ACCOUNT AMOUNTS CHANGED Change Account to: Based Upon Course Start Date Account to be changed Ch 9 Ex 3 Edison Cash Stagg Cash Thornton Cash Original Amount Jan - Feb Mar-Apr May-Jun Jul-Aug Sept-Oct Nov-Dec $4,000 5,000 6,000 7,000 8,000 9,000 10,000 $2,500 3,500 4,500 5,500 6,500 7,500 8,500 $1,000 2,000 3,000 4,000 5,000 6,000 7,000 YOUR ANSWERS BASED UPON COURSE START DATE Questions Compute the current and quick ratios for each of the three companies. (Round calculations to two decimal places.) Which firm is the most liquid? Why? Edison Current ratio Quick ratio Stagg Current ratio Quick ratio Thornton Current ratio Quick ratio Suppose Thornton is using FIFO for inventory valuation and Edison is using LIFO. Comment on the comparability of information between these two companies. If all short-term notes payable are due on July 11 at 8 a.m., comment on each company's ability to settle its obligation in a timely manner. Net Credit Sales Cost of Goods Sold Account to be changed Ch 9 Ex 4 20X5 $832,000 440,000 Questions Original Amount 20X4 $760,000 350,000 YOUR ANSWERS BASED UPON COURSE START DATE Jan - Feb 20X5 842,000 450,000 20X4 760,000 350,000 Mar-Apr 20X5 852,000 460,000 20X4 760,000 350,000 May-Jun 20X5 862,000 470,000 20X4 760,000 350,000 Jul-Aug 20X5 872,000 480,000 20X4 760,000 350,000 Sept-Oct 20X5 882,000 490,000 Nov-Dec 20X4 760,000 350,000 20X5 892,000 500,000 20X4 760,000 350,000 The company is planning to borrow $300,000 via a 90day bank loan to cover short-term operating needs. a. Compute the accounts-receivable and inventoryturnover ratios for 20X5 Accounts Receivable Turnover Inventory Turnover Study the ratios from part (a) and comment on the company's ability to repay a bank loan in 90 days. Suppose that Alaska's major line of business involves the processing and distribution of fresh and frozen fish throughout the United States. Do you have any concerns about the company's inventory-turnover ratio? Briefly discuss. Account to be changed Original Amount Jan - Feb Mar-Apr May-Jun Jul-Aug Sept-Oct Nov-Dec Ch 9 Pb 1 20X5 20X5 20X4 20X5 20X4 20X5 20X4 20X5 20X4 20X5 20X4 20X5 20X4 12500 25000 35000 3750 76250 101250 30000 40000 171250 2500 250000 70000 40000 25000 135000 25000 160000 25000 65000 90000 250000 12,250 19,500 39,500 4,750 73,000 103,750 29,500 33,000 164,250 15,750 251,000 50,000 14,500 3,500 66,000 51,000 116,000 26,000 111,000 136,000 251,000 13,400 25,900 35,900 4,650 77,150 102,150 30,900 40,900 172,150 3,400 250,900 70,900 40,900 25,900 135,900 25,900 160,900 25,900 65,900 90,900 250,900 13,250 20,500 40,500 5,750 74,000 104,750 30,500 34,000 165,250 16,750 252,000 51,000 15,500 4,500 67,000 52,000 117,000 27,000 112,000 137,000 252,000 14,300 26,800 36,800 5,550 78,050 103,050 31,800 41,800 173,050 4,300 251,800 71,800 41,800 26,800 136,800 26,800 161,800 26,800 66,800 91,800 251,800 14,250 21,500 41,500 6,750 75,000 105,750 31,500 35,000 166,250 17,750 253,000 52,000 16,500 5,500 68,000 53,000 118,000 28,000 113,000 138,000 253,000 15,200 27,700 37,700 6,450 78,950 103,950 32,700 42,700 173,950 5,200 252,700 72,700 42,700 27,700 137,700 27,700 162,700 27,700 67,700 92,700 252,700 15,250 22,500 42,500 7,750 76,000 106,750 32,500 36,000 167,250 18,750 254,000 53,000 17,500 6,500 69,000 54,000 119,000 29,000 114,000 139,000 254,000 16,100 28,600 38,600 7,350 79,850 104,850 33,600 43,600 174,850 6,100 253,600 73,600 43,600 28,600 138,600 28,600 163,600 28,600 68,600 93,600 253,600 16,250 23,500 43,500 8,750 77,000 107,750 33,500 37,000 168,250 19,750 255,000 54,000 18,500 7,500 70,000 55,000 120,000 30,000 115,000 140,000 255,000 17,000 29,500 39,500 8,250 80,750 105,750 34,500 44,500 175,750 7,000 254,500 74,500 44,500 29,500 139,500 29,500 164,500 29,500 69,500 94,500 254,500 17,250 24,500 44,500 9,750 78,000 108,750 34,500 38,000 169,250 20,750 256,000 55,000 19,500 8,500 71,000 56,000 121,000 31,000 116,000 141,000 256,000 17,900 30,400 40,400 9,150 81,650 106,650 35,400 45,400 176,650 7,900 255,400 75,400 45,400 30,400 140,400 30,400 165,400 30,400 70,400 95,400 255,400 20X4 500000 20X5 575,000 20X4 510,000 20X5 580,000 20X4 520,000 20X5 585,000 20X4 521,000 20X5 590,000 20X4 523,000 20X5 595,000 20X4 525,000 20X5 600,000 20X4 535,000 20X4 Assets PLACE YOUR ANSWERS BELOW STARTING ON Current Assets ROW 99 Cash 11250 Accounts Receivable (net) 18500 Inventories 38500 Prepaid Expense 3750 Total Current Assets 72000 Buildings (net) 102750 Equipment (net) 28500 Vehicles (net) 32000 Total Property, Plant, and Equipment 163250 Trademarks (net) 14750 Total assets 250000 Accounts Payable 49000 Notes Payable 13500 Federal Taxes Payable 2500 Total Current Liabilities 65000 Long-Term Debt 50000 Total Liabilities 115000 Common Stock, $10 par 25000 Retained Earnings 110000 Total Stockholders' Equity 135000 Total Liabilities and Stockholders' Eq 250000 WATERLOO CORPORATION Comparative Income Statements For the Years Ending December 31, 20X5 and Net Sales 20X5 550000 Prepare a horizontal analysis of the balance sheet, showing dollar and percentage changes. Round all calculations in parts (a) and (b) to two decimal places. YOUR ANSWERS BASED UPON COURSE START DATE Questions WATERLOO CORPORATION Comparative Balance Sheets December 31,20X5 and 20X4 Assets Current Assets Cash Accounts Receivable (net) Inventories Prepaid Expense Total Current Assets Buildings (net) Equipment (net) Vehicles (net) Total Property, Plant, and Equipment Trademarks (net) Total assets Accounts Payable Notes Payable Federal Taxes Payable Total Current Liabilities Long-Term Debt Total Liabilities Common Stock, $10 par Retained Earnings Total Stockholders' Equity Total Liabilities and Stockholders' Equity WATERLOO CORPORATION Comparative Income Statements For the Years Ending December 31, 20X5 and 20X4 Prepare a vertical analysis of the income statement by relating each item to net sales. Net Sales Cost of Goods Sold Gross Profit Operating Expense Income Before Interest and Taxes Interest Expense Income Before Taxes Income Tax Expense Net Income Account to be changed Original Amount Jan - Feb Mar-Apr May-Jun Jul-Aug Sept-Oct Nov-Dec Ch 9 Pb 2 LONE PINE COMPANY Comparative Balance Sheets December 31, 20X2 and 20X1 ($000 Omitted) 20X2 Assets Current Assets Cash and Short-Term Investments Accounts Receivable (net) Inventories Total Current Assets Land Buildings and Equipment (net) Total Property, Plant, and Equipment Total Assets Accounts Payable Notes Payable Total Current Liabilities Bonds Payable Total Liabilities 20X2 20X1 20X1 20X2 20X1 20X2 20X1 20X2 20X1 20X2 20X1 20X2 20X1 1,400 4,000 4,000 9,400 2,700 2,500 5,200 14,600 2,800 2,100 3,900 5,100 9,000 1,400 3,200 3,000 7,600 1,400 1,800 3,200 10,800 2,500 2,700 4,400 2,900 7,300 2,400 5,000 4,000 11,400 3,700 3,500 7,200 18,600 3,800 3,100 4,900 6,100 11,000 2,200 4,000 3,800 10,000 2,200 2,600 4,800 14,800 3,300 3,500 5,200 3,700 8,900 3,400 6,000 5,000 14,400 4,700 4,500 9,200 23,600 4,800 4,100 5,900 7,100 13,000 3,000 4,800 4,600 12,400 3,000 3,400 6,400 18,800 4,100 4,300 6,000 4,500 10,500 4,400 7,000 6,000 17,400 5,700 5,500 11,200 28,600 5,800 5,100 6,900 8,100 15,000 3,800 5,600 5,400 14,800 3,800 4,200 8,000 22,800 4,900 5,100 6,800 5,300 12,100 5,400 8,000 7,000 20,400 6,700 6,500 13,200 33,600 6,800 6,100 7,900 9,100 17,000 4,600 6,400 6,200 17,200 4,600 5,000 9,600 26,800 5,700 5,900 7,600 6,100 13,700 6,400 9,000 8,000 23,400 7,700 7,500 15,200 38,600 7,800 7,100 8,900 10,100 19,000 5,400 7,200 7,000 19,600 5,400 5,800 11,200 30,800 6,500 6,700 8,400 6,900 15,300 PLACE YOUR ANSWERS BELOW STARTING ON ROW 176 400 3000 2000 5400 1700 1500 3200 8600 1800 1100 2900 4100 7000 600 2400 2200 5200 600 1000 1600 6800 1700 1900 3600 2100 5700 Common Stock Par value $1 (Par value not in original problem, but needed to calculate ratio - dividend payout rate) 200 200 1400 1600 8600 Number of Shares Retained Earnings Total Stockholders' Equity Total Liabilities and Stockholders' Eq 200 200 900 1100 6800 1,200 1,200 4,400 5,600 14,600 1,000 1,000 2,500 3,500 10,800 2,200 2,200 5,400 7,600 18,600 1,800 1,800 4,100 5,900 14,800 3,200 3,200 7,400 10,600 23,600 2,600 2,600 5,700 8,300 18,800 4,200 4,200 9,400 13,600 28,600 3,400 3,400 7,300 10,700 22,800 5,200 5,200 11,400 16,600 33,600 4,200 4,200 8,900 13,100 26,800 6,200 6,200 13,400 19,600 38,600 LONE PINE COMPANY Statement of Income and Retained Earnings For the Year Ending December 31,20X2 ($000 Omitted) 36000 Net Sales* Questions 39,000 41,000 45,000 46,000 YOUR ANSWERS BASED UPON COURSE START DATE Compute the following items for Lone Pine Company for 20X2, rounding all calculations to two decimal places and do nt insert a percent symbol. Quick ratio Current ratio Inventory-turnover ratio Accounts-receivable-turnover ratio Return-on-assets ratio Net-profit-margin ratio Return-on-common-stockholders' equity Debt-to-total assets Number of times that interest is earned Dividend payout rate Account to be changed Ch 9 Pb 3 Cost of goods sold % Questions LOCK BOX INC. Income Statement For the Year Ending December 31, 20X3 Sales Cost of Goods Sold Gross Profit Operating Expenses and Interest Income Before Taxes Income taxes, 40% Net income LOCK BOX INC. Balance Sheet December 31, 20X3 Assets Cash Accounts Receivable Inventory Property, Plant, and Equipment Total assets Liabilities and Stockholders' Equity Accounts Payable Notes Payable: Short-Term Bonds Payable Common Stock Retained Earnings Total Liabilities and Stockholders' Equity Original Amount 60.0% YOUR ANSWERS BASED UPON COURSE START DATE Jan - Feb Mar-Apr May-Jun Jul-Aug Sept-Oct Nov-Dec 60.1% 60.2% 60.3% 60.4% 60.5% 60.6% 49,000 55,000 5,000 5,000 10,500 15,500 30,800 Net ### ### Cost 440,000 350,000 Ashford University ACC205 Guidance Report Week Five LISTEN TO AUDIO/VIDEO EXPLAINING THE GUIDANCE REPORT YELLOW INDICATES ACCOUNT AMOUNTS CHANGED Change Account to: Based Upon Course Start Date Account to be changed Ch 9 Ex 3 Edison Cash Stagg Cash Thornton Cash Original Amount Jan - Feb Mar-Apr May-Jun Jul-Aug Sept-Oct Nov-Dec $4,000 5,000 6,000 7,000 8,000 9,000 10,000 $2,500 3,500 4,500 5,500 6,500 7,500 8,500 $1,000 2,000 3,000 4,000 5,000 6,000 7,000 YOUR ANSWERS BASED UPON COURSE START DATE Questions Compute the current and quick ratios for each of the three companies. (Round calculations to two decimal places.) Which firm is the most liquid? Why? Edison Current ratio Quick ratio Stagg Current ratio Quick ratio Thornton Current ratio Quick ratio Suppose Thornton is using FIFO for inventory valuation and Edison is using LIFO. Comment on the comparability of information between these two companies. If all short-term notes payable are due on July 11 at 8 a.m., comment on each company's ability to settle its obligation in a timely manner. Net Credit Sales Cost of Goods Sold Account to be changed Ch 9 Ex 4 20X5 $832,000 440,000 Questions Original Amount 20X4 $760,000 350,000 YOUR ANSWERS BASED UPON COURSE START DATE Jan - Feb 20X5 842,000 450,000 20X4 760,000 350,000 Mar-Apr 20X5 852,000 460,000 20X4 760,000 350,000 May-Jun 20X5 862,000 470,000 20X4 760,000 350,000 Jul-Aug 20X5 872,000 480,000 20X4 760,000 350,000 Sept-Oct 20X5 882,000 490,000 Nov-Dec 20X4 760,000 350,000 20X5 892,000 500,000 20X4 760,000 350,000 The company is planning to borrow $300,000 via a 90day bank loan to cover short-term operating needs. a. Compute the accounts-receivable and inventoryturnover ratios for 20X5 Accounts Receivable Turnover Inventory Turnover Study the ratios from part (a) and comment on the company's ability to repay a bank loan in 90 days. Suppose that Alaska's major line of business involves the processing and distribution of fresh and frozen fish throughout the United States. Do you have any concerns about the company's inventory-turnover ratio? Briefly discuss. Account to be changed Original Amount Jan - Feb Mar-Apr May-Jun Jul-Aug Sept-Oct Nov-Dec Ch 9 Pb 1 20X5 20X5 20X4 20X5 20X4 20X5 20X4 20X5 20X4 20X5 20X4 20X5 20X4 12500 25000 35000 3750 76250 101250 30000 40000 171250 2500 250000 70000 40000 25000 135000 25000 160000 25000 65000 90000 250000 12,250 19,500 39,500 4,750 73,000 103,750 29,500 33,000 164,250 15,750 251,000 50,000 14,500 3,500 66,000 51,000 116,000 26,000 111,000 136,000 251,000 13,400 25,900 35,900 4,650 77,150 102,150 30,900 40,900 172,150 3,400 250,900 70,900 40,900 25,900 135,900 25,900 160,900 25,900 65,900 90,900 250,900 13,250 20,500 40,500 5,750 74,000 104,750 30,500 34,000 165,250 16,750 252,000 51,000 15,500 4,500 67,000 52,000 117,000 27,000 112,000 137,000 252,000 14,300 26,800 36,800 5,550 78,050 103,050 31,800 41,800 173,050 4,300 251,800 71,800 41,800 26,800 136,800 26,800 161,800 26,800 66,800 91,800 251,800 14,250 21,500 41,500 6,750 75,000 105,750 31,500 35,000 166,250 17,750 253,000 52,000 16,500 5,500 68,000 53,000 118,000 28,000 113,000 138,000 253,000 15,200 27,700 37,700 6,450 78,950 103,950 32,700 42,700 173,950 5,200 252,700 72,700 42,700 27,700 137,700 27,700 162,700 27,700 67,700 92,700 252,700 15,250 22,500 42,500 7,750 76,000 106,750 32,500 36,000 167,250 18,750 254,000 53,000 17,500 6,500 69,000 54,000 119,000 29,000 114,000 139,000 254,000 16,100 28,600 38,600 7,350 79,850 104,850 33,600 43,600 174,850 6,100 253,600 73,600 43,600 28,600 138,600 28,600 163,600 28,600 68,600 93,600 253,600 16,250 23,500 43,500 8,750 77,000 107,750 33,500 37,000 168,250 19,750 255,000 54,000 18,500 7,500 70,000 55,000 120,000 30,000 115,000 140,000 255,000 17,000 29,500 39,500 8,250 80,750 105,750 34,500 44,500 175,750 7,000 254,500 74,500 44,500 29,500 139,500 29,500 164,500 29,500 69,500 94,500 254,500 17,250 24,500 44,500 9,750 78,000 108,750 34,500 38,000 169,250 20,750 256,000 55,000 19,500 8,500 71,000 56,000 121,000 31,000 116,000 141,000 256,000 17,900 30,400 40,400 9,150 81,650 106,650 35,400 45,400 176,650 7,900 255,400 75,400 45,400 30,400 140,400 30,400 165,400 30,400 70,400 95,400 255,400 20X4 500000 20X5 575,000 20X4 510,000 20X5 580,000 20X4 520,000 20X5 585,000 20X4 521,000 20X5 590,000 20X4 523,000 20X5 595,000 20X4 525,000 20X5 600,000 20X4 535,000 20X4 Assets PLACE YOUR ANSWERS BELOW STARTING ON Current Assets ROW 99 Cash 11250 Accounts Receivable (net) 18500 Inventories 38500 Prepaid Expense 3750 Total Current Assets 72000 Buildings (net) 102750 Equipment (net) 28500 Vehicles (net) 32000 Total Property, Plant, and Equipment 163250 Trademarks (net) 14750 Total assets 250000 Accounts Payable 49000 Notes Payable 13500 Federal Taxes Payable 2500 Total Current Liabilities 65000 Long-Term Debt 50000 Total Liabilities 115000 Common Stock, $10 par 25000 Retained Earnings 110000 Total Stockholders' Equity 135000 Total Liabilities and Stockholders' Eq 250000 WATERLOO CORPORATION Comparative Income Statements For the Years Ending December 31, 20X5 and Net Sales 20X5 550000 Prepare a horizontal analysis of the balance sheet, showing dollar and percentage changes. Round all calculations in parts (a) and (b) to two decimal places. YOUR ANSWERS BASED UPON COURSE START DATE Questions WATERLOO CORPORATION Comparative Balance Sheets December 31,20X5 and 20X4 Assets Current Assets Cash Accounts Receivable (net) Inventories Prepaid Expense Total Current Assets Buildings (net) Equipment (net) Vehicles (net) Total Property, Plant, and Equipment Trademarks (net) Total assets Accounts Payable Notes Payable Federal Taxes Payable Total Current Liabilities Long-Term Debt Total Liabilities Common Stock, $10 par Retained Earnings Total Stockholders' Equity Total Liabilities and Stockholders' Equity WATERLOO CORPORATION Comparative Income Statements For the Years Ending December 31, 20X5 and 20X4 Prepare a vertical analysis of the income statement by relating each item to net sales. Net Sales Cost of Goods Sold Gross Profit Operating Expense Income Before Interest and Taxes Interest Expense Income Before Taxes Income Tax Expense Net Income Account to be changed Original Amount Jan - Feb Mar-Apr May-Jun Jul-Aug Sept-Oct Nov-Dec Ch 9 Pb 2 LONE PINE COMPANY Comparative Balance Sheets December 31, 20X2 and 20X1 ($000 Omitted) 20X2 Assets Current Assets Cash and Short-Term Investments Accounts Receivable (net) Inventories Total Current Assets Land Buildings and Equipment (net) Total Property, Plant, and Equipment Total Assets Accounts Payable Notes Payable Total Current Liabilities Bonds Payable Total Liabilities 20X2 20X1 20X1 20X2 20X1 20X2 20X1 20X2 20X1 20X2 20X1 20X2 20X1 1,400 4,000 4,000 9,400 2,700 2,500 5,200 14,600 2,800 2,100 3,900 5,100 9,000 1,400 3,200 3,000 7,600 1,400 1,800 3,200 10,800 2,500 2,700 4,400 2,900 7,300 2,400 5,000 4,000 11,400 3,700 3,500 7,200 18,600 3,800 3,100 4,900 6,100 11,000 2,200 4,000 3,800 10,000 2,200 2,600 4,800 14,800 3,300 3,500 5,200 3,700 8,900 3,400 6,000 5,000 14,400 4,700 4,500 9,200 23,600 4,800 4,100 5,900 7,100 13,000 3,000 4,800 4,600 12,400 3,000 3,400 6,400 18,800 4,100 4,300 6,000 4,500 10,500 4,400 7,000 6,000 17,400 5,700 5,500 11,200 28,600 5,800 5,100 6,900 8,100 15,000 3,800 5,600 5,400 14,800 3,800 4,200 8,000 22,800 4,900 5,100 6,800 5,300 12,100 5,400 8,000 7,000 20,400 6,700 6,500 13,200 33,600 6,800 6,100 7,900 9,100 17,000 4,600 6,400 6,200 17,200 4,600 5,000 9,600 26,800 5,700 5,900 7,600 6,100 13,700 6,400 9,000 8,000 23,400 7,700 7,500 15,200 38,600 7,800 7,100 8,900 10,100 19,000 5,400 7,200 7,000 19,600 5,400 5,800 11,200 30,800 6,500 6,700 8,400 6,900 15,300 PLACE YOUR ANSWERS BELOW STARTING ON ROW 176 400 3000 2000 5400 1700 1500 3200 8600 1800 1100 2900 4100 7000 600 2400 2200 5200 600 1000 1600 6800 1700 1900 3600 2100 5700 Common Stock Par value $1 (Par value not in original problem, but needed to calculate ratio - dividend payout rate) 200 200 1400 1600 8600 Number of Shares Retained Earnings Total Stockholders' Equity Total Liabilities and Stockholders' Eq 200 200 900 1100 6800 1,200 1,200 4,400 5,600 14,600 1,000 1,000 2,500 3,500 10,800 2,200 2,200 5,400 7,600 18,600 1,800 1,800 4,100 5,900 14,800 3,200 3,200 7,400 10,600 23,600 2,600 2,600 5,700 8,300 18,800 4,200 4,200 9,400 13,600 28,600 3,400 3,400 7,300 10,700 22,800 5,200 5,200 11,400 16,600 33,600 4,200 4,200 8,900 13,100 26,800 6,200 6,200 13,400 19,600 38,600 LONE PINE COMPANY Statement of Income and Retained Earnings For the Year Ending December 31,20X2 ($000 Omitted) 36000 Net Sales* Questions 39,000 41,000 45,000 46,000 YOUR ANSWERS BASED UPON COURSE START DATE Compute the following items for Lone Pine Company for 20X2, rounding all calculations to two decimal places and do nt insert a percent symbol. Quick ratio Current ratio Inventory-turnover ratio Accounts-receivable-turnover ratio Return-on-assets ratio Net-profit-margin ratio Return-on-common-stockholders' equity Debt-to-total assets Number of times that interest is earned Dividend payout rate Account to be changed Ch 9 Pb 3 Cost of goods sold % Questions LOCK BOX INC. Income Statement For the Year Ending December 31, 20X3 Sales Cost of Goods Sold Gross Profit Operating Expenses and Interest Income Before Taxes Income taxes, 40% Net income LOCK BOX INC. Balance Sheet December 31, 20X3 Assets Cash Accounts Receivable Inventory Property, Plant, and Equipment Total assets Liabilities and Stockholders' Equity Accounts Payable Notes Payable: Short-Term Bonds Payable Common Stock Retained Earnings Total Liabilities and Stockholders' Equity Original Amount 60.0% YOUR ANSWERS BASED UPON COURSE START DATE Jan - Feb Mar-Apr May-Jun Jul-Aug Sept-Oct Nov-Dec 60.1% 60.2% 60.3% 60.4% 60.5% 60.6% 49,000 55,000 5,000 5,000 10,500 15,500 30,800 Net ### ### Cost 440,000 350,000 Ashford University ACC205 Guidance Report Week Five LISTEN TO AUDIO/VIDEO EXPLAINING THE GUIDANCE REPORT YELLOW INDICATES ACCOUNT AMOUNTS CHANGED Change Account to: Based Upon Course Start Date Account to be changed Ch 9 Ex 3 Edison Cash Stagg Cash Thornton Cash Original Amount Jan - Feb Mar-Apr May-Jun Jul-Aug Sept-Oct Nov-Dec $4,000 5,000 6,000 7,000 8,000 9,000 10,000 $2,500 3,500 4,500 5,500 6,500 7,500 8,500 $1,000 2,000 3,000 4,000 5,000 6,000 7,000 YOUR ANSWERS BASED UPON COURSE START DATE Questions Compute the current and quick ratios for each of the three companies. (Round calculations to two decimal places.) Which firm is the most liquid? Why? Edison Current ratio Quick ratio 3.28 2.78 Current ratio Quick ratio 3.28 2.36 Current ratio Quick ratio 3.28 1.94 Stagg Thornton Suppose Thornton is using FIFO for inventory valuation and Edison is using LIFO. Comment on the comparability of information between these two companies. If all short-term notes payable are due on July 11 at 8 a.m., comment on each company's ability to settle its obligation in a timely manner. Net Credit Sales Cost of Goods Sold Account to be changed Ch 9 Ex 4 20X5 $832,000 440,000 Questions edison has better liquidity because quick ratio is higher and despite of difference in inventory valuation current ratio is eqal not higher Edison company is in strongest position as current ratio of all companies is equal but its quivk ratio is highest. Original Amount 20X4 $760,000 350,000 YOUR ANSWERS BASED UPON COURSE START DATE Jan - Feb 20X5 842,000 450,000 20X4 760,000 350,000 Mar-Apr 20X5 852,000 460,000 20X4 760,000 350,000 May-Jun 20X5 862,000 470,000 20X4 760,000 350,000 Jul-Aug 20X5 872,000 480,000 20X4 760,000 350,000 Sept-Oct 20X5 882,000 490,000 Nov-Dec 20X4 760,000 350,000 20X5 892,000 500,000 20X4 760,000 350,000 The company is planning to borrow $300,000 via a 90day bank loan to cover short-term operating needs. a. Compute the accounts-receivable and inventoryturnover ratios for 20X5 Accounts receivable turnover is low indicating higher credit allowed to custmers and inventory turnover being high indicating lesser period of inventory with company before ot is sold to customers. Accounts Receivable Turnover 5.26 7.50 Inventory Turnover Study the ratios from part (a) and comment on the company's ability to repay a bank loan in 90 days. It will be difficult for company to repay loan in 90 days because its accounts receivable tunover is very low. Suppose that Alaska's major line of business involves the processing and distribution of Yes, on division fresh and frozen basis accounts fish throughout the receivable United States. Do turnover should be you have any calculated and concerns about the quick ratio should company's be monitores and inventory-turnover cash management should be prompt. ratio? Briefly discuss. Account to be changed Original Amount Jan - Feb Mar-Apr May-Jun Jul-Aug Sept-Oct Nov-Dec Ch 9 Pb 1 20X5 20X5 20X4 20X5 20X4 20X5 20X4 20X5 20X4 20X5 20X4 20X5 20X4 12500 25000 35000 3750 76250 101250 30000 40000 171250 2500 250000 70000 40000 25000 135000 25000 160000 25000 65000 90000 250000 12,250 19,500 39,500 4,750 73,000 103,750 29,500 33,000 164,250 15,750 251,000 50,000 14,500 3,500 66,000 51,000 116,000 26,000 111,000 136,000 251,000 13,400 25,900 35,900 4,650 77,150 102,150 30,900 40,900 172,150 3,400 250,900 70,900 40,900 25,900 135,900 25,900 160,900 25,900 65,900 90,900 250,900 13,250 20,500 40,500 5,750 74,000 104,750 30,500 34,000 165,250 16,750 252,000 51,000 15,500 4,500 67,000 52,000 117,000 27,000 112,000 137,000 252,000 14,300 26,800 36,800 5,550 78,050 103,050 31,800 41,800 173,050 4,300 251,800 71,800 41,800 26,800 136,800 26,800 161,800 26,800 66,800 91,800 251,800 14,250 21,500 41,500 6,750 75,000 105,750 31,500 35,000 166,250 17,750 253,000 52,000 16,500 5,500 68,000 53,000 118,000 28,000 113,000 138,000 253,000 15,200 27,700 37,700 6,450 78,950 103,950 32,700 42,700 173,950 5,200 252,700 72,700 42,700 27,700 137,700 27,700 162,700 27,700 67,700 92,700 252,700 15,250 22,500 42,500 7,750 76,000 106,750 32,500 36,000 167,250 18,750 254,000 53,000 17,500 6,500 69,000 54,000 119,000 29,000 114,000 139,000 254,000 16,100 28,600 38,600 7,350 79,850 104,850 33,600 43,600 174,850 6,100 253,600 73,600 43,600 28,600 138,600 28,600 163,600 28,600 68,600 93,600 253,600 16,250 23,500 43,500 8,750 77,000 107,750 33,500 37,000 168,250 19,750 255,000 54,000 18,500 7,500 70,000 55,000 120,000 30,000 115,000 140,000 255,000 17,000 29,500 39,500 8,250 80,750 105,750 34,500 44,500 175,750 7,000 254,500 74,500 44,500 29,500 139,500 29,500 164,500 29,500 69,500 94,500 254,500 17,250 24,500 44,500 9,750 78,000 108,750 34,500 38,000 169,250 20,750 256,000 55,000 19,500 8,500 71,000 56,000 121,000 31,000 116,000 141,000 256,000 17,900 30,400 40,400 9,150 81,650 106,650 35,400 45,400 176,650 7,900 255,400 75,400 45,400 30,400 140,400 30,400 165,400 30,400 70,400 95,400 255,400 20X4 500000 20X5 575,000 20X4 510,000 20X5 580,000 20X4 520,000 20X5 585,000 20X4 521,000 20X5 590,000 20X4 523,000 20X5 595,000 20X4 525,000 20X5 600,000 20X4 535,000 20X4 Assets PLACE YOUR ANSWERS BELOW STARTING ON Current Assets ROW 99 Cash 11250 Accounts Receivable (net) 18500 Inventories 38500 Prepaid Expense 3750 Total Current Assets 72000 Buildings (net) 102750 Equipment (net) 28500 Vehicles (net) 32000 Total Property, Plant, and Equipment 163250 Trademarks (net) 14750 Total assets 250000 Accounts Payable 49000 Notes Payable 13500 Federal Taxes Payable 2500 Total Current Liabilities 65000 Long-Term Debt 50000 Total Liabilities 115000 Common Stock, $10 par 25000 Retained Earnings 110000 Total Stockholders' Equity 135000 Total Liabilities and Stockholders' Eq 250000 WATERLOO CORPORATION Comparative Income Statements For the Years Ending December 31, 20X5 and Net Sales 20X5 550000 Prepare a horizontal analysis of the balance sheet, showing dollar and percentage changes. Round all calculations in parts (a) and (b) to two decimal places. YOUR ANSWERS BASED UPON COURSE START DATE Questions WATERLOO CORPORATION Comparative Balance Sheets December 31,20X5 and 20X4 Assets Current Assets Cash Accounts Receivable (net) Inventories Prepaid Expense Total Current Assets Buildings (net) Equipment (net) Vehicles (net) Total Property, Plant, and Equipment Trademarks (net) Total assets Accounts Payable Notes Payable Federal Taxes Payable Total Current Liabilities Long-Term Debt Total Liabilities Common Stock, $10 par Retained Earnings Total Stockholders' Equity -250.00 -5500.00 4500.00 -3275.00 -3250.00 2500.00 -500.00 -7000.00 -7000.00 13250.00 1000.00 -20000.00 -25500.00 -21500.00 -69000.00 26000.00 -44000.00 1000.00 46000.00 46000.00 1000.00 0.40 2015 100.00 60.00 40.00 24.09 15.91 2.27 13.64 5.45 8.18 Total Liabilities and Stockholders' Equity -2.00 -22.00 12.86 -87.33 -4.26 2.47 -1.67 -17.50 -4.09 530.00 0.40 -28.57 -63.75 -86.00 -51.11 104.00 -27.50 4.00 70.77 51.11 2014 100.00 50.00 50.00 20.00 30.00 0.60 29.40 11.76 17.64 WATERLOO CORPORATION Comparative Income Statements For the Years Ending December 31, 20X5 and 20X4 Prepare a vertical analysis of the income statement by relating each item to net sales. Net Sales Cost of Goods Sold Gross Profit Operating Expense Income Before Interest and Taxes Interest Expense Income Before Taxes Income Tax Expense Net Income Account to be changed Original Amount Jan - Feb Mar-Apr May-Jun Jul-Aug Sept-Oct Nov-Dec Ch 9 Pb 2 LONE PINE COMPANY Comparative Balance Sheets December 31, 20X2 and 20X1 ($000 Omitted) 20X2 Assets Current Assets Cash and Short-Term Investments Accounts Receivable (net) Inventories Total Current Assets Land Buildings and Equipment (net) Total Property, Plant, and Equipment Total Assets Accounts Payable Notes Payable Total Current Liabilities Bonds Payable Total Liabilities 20X2 20X1 20X1 20X2 20X1 20X2 20X1 20X2 20X1 20X2 20X1 20X2 20X1 1,400 4,000 4,000 9,400 2,700 2,500 5,200 14,600 2,800 2,100 3,900 5,100 9,000 1,400 3,200 3,000 7,600 1,400 1,800 3,200 10,800 2,500 2,700 4,400 2,900 7,300 2,400 5,000 4,000 11,400 3,700 3,500 7,200 18,600 3,800 3,100 4,900 6,100 11,000 2,200 4,000 3,800 10,000 2,200 2,600 4,800 14,800 3,300 3,500 5,200 3,700 8,900 3,400 6,000 5,000 14,400 4,700 4,500 9,200 23,600 4,800 4,100 5,900 7,100 13,000 3,000 4,800 4,600 12,400 3,000 3,400 6,400 18,800 4,100 4,300 6,000 4,500 10,500 4,400 7,000 6,000 17,400 5,700 5,500 11,200 28,600 5,800 5,100 6,900 8,100 15,000 3,800 5,600 5,400 14,800 3,800 4,200 8,000 22,800 4,900 5,100 6,800 5,300 12,100 5,400 8,000 7,000 20,400 6,700 6,500 13,200 33,600 6,800 6,100 7,900 9,100 17,000 4,600 6,400 6,200 17,200 4,600 5,000 9,600 26,800 5,700 5,900 7,600 6,100 13,700 6,400 9,000 8,000 23,400 7,700 7,500 15,200 38,600 7,800 7,100 8,900 10,100 19,000 5,400 7,200 7,000 19,600 5,400 5,800 11,200 30,800 6,500 6,700 8,400 6,900 15,300 PLACE YOUR ANSWERS BELOW STARTING ON ROW 176 400 3000 2000 5400 1700 1500 3200 8600 1800 1100 2900 4100 7000 600 2400 2200 5200 600 1000 1600 6800 1700 1900 3600 2100 5700 Common Stock Par value $1 (Par value not in original problem, but needed to calculate ratio - dividend payout rate) 200 200 1400 1600 8600 Number of Shares Retained Earnings Total Stockholders' Equity Total Liabilities and Stockholders' Eq 200 200 900 1100 6800 1,200 1,200 4,400 5,600 14,600 1,000 1,000 2,500 3,500 10,800 2,200 2,200 5,400 7,600 18,600 1,800 1,800 4,100 5,900 14,800 3,200 3,200 7,400 10,600 23,600 2,600 2,600 5,700 8,300 18,800 4,200 4,200 9,400 13,600 28,600 3,400 3,400 7,300 10,700 22,800 5,200 5,200 11,400 16,600 33,600 4,200 4,200 8,900 13,100 26,800 6,200 6,200 13,400 19,600 38,600 LONE PINE COMPANY Statement of Income and Retained Earnings For the Year Ending December 31,20X2 ($000 Omitted) 36000 Net Sales* Questions 39,000 41,000 45,000 46,000 YOUR ANSWERS BASED UPON COURSE START DATE Compute the following items for Lone Pine Company for 20X2, rounding all calculations to two decimal places and do nt insert a percent symbol. 1.38 2.41 9.75 9.75 0.25 0.10 0.64 1.61 87.00 0.86 Quick ratio Current ratio Inventory-turnover ratio Accounts-receivable-turnover ratio Return-on-assets ratio Net-profit-margin ratio Return-on-common-stockholders' equity Debt-to-total assets Number of times that interest is earned Dividend payout rate Account to be changed Ch 9 Pb 3 Cost of goods sold % Questions LOCK BOX INC. Income Statement For the Year Ending December 31, 20X3 Sales Cost of Goods Sold Gross Profit Operating Expenses and Interest Income Before Taxes Income taxes, 40% Net income LOCK BOX INC. Balance Sheet December 31, 20X3 Assets Cash Accounts Receivable Inventory Property, Plant, and Equipment Total assets Liabilities and Stockholders' Equity Accounts Payable Notes Payable: Short-Term Bonds Payable Common Stock Retained Earnings Total Liabilities and Stockholders' Equity Original Amount 60.0% YOUR ANSWERS BASED UPON COURSE START DATE 37593984.96 22593984.96 15000000.00 14248120.30 751879.70 1503759.40 2255639.10 1782706.77 7318796.99 6898496.24 8000000.00 24000000.00 600000.00 4600000.00 2000000.00 24000000.00 Jan - Feb Mar-Apr May-Jun Jul-Aug Sept-Oct Nov-Dec 60.1% 60.2% 60.3% 60.4% 60.5% 60.6% 49,000 55,000 5,000 5,000 10,500 15,500 30,800 Net ### ### Cost 440,000 350,000