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Help. Use excel Excel #1; Financial Statements & Ratios There you sit trying to decide whether to actually read the assigned chapter from your accounting
Help. Use excel
Excel \#1; Financial Statements \& Ratios There you sit trying to decide whether to actually read the assigned chapter from your accounting class, or go to a party across campus. After a few moments of thought you figure that the accounting test is a week from now and that your time can be better utilized enjoying life. As you lock your door to leave you receive a text from your cousin Dewey Jr. Dewey Jr., is about your age. His father has several businesses and from what your mother says is doing quite well. Dewey Jr. writes; "Dad needs some help with some business stuff. Something about financial statements and some ratios. It sounds like math to me and you know I don't do math. You're in business collage, right? Can you help me? Dad thinks that since I'm in collage that I should know how to do things, but we don't have to do math at my collage" You know that's true - Dewey Jr. is the Mr. Potatohead of mathematics and you suspect that this characteristic may be genetic. Somewhat intrigued you text back, "Yeah, I'm studying business, but it's at a college not a collage. What are you majoring in now?" Knowing that Dewey Jr. has tried every major from pre-med to post-modern art you are not that surprised when he replies, "I' m going to be a crypto-zoologist and I'm going to specialize in studying whether Bigfoot has a chupacabra for a pet like we do with dogs." You lose a few minutes contemplating this, and finally, not knowing what else to say you reply, "Send me an email with what you need doing and maybe I can help." The next day Dewey Jr. finally sends an email stating, "Dad needs some balance sheets and income statements for the past couple of years. So here are the accounts in the business... The dollar amounts are for this year and last year, respectively: Accounts Payable; $160 and $2,160 Accounts Receivable, net; $3,901 and $1,600 Cash; $2960 and $1,260 Common Stock, $1 par; $5,000 and $5,000 Cost of Goods Sold; $15,138 and $9,900 Income Tax rate; 30% and 37% Interest Expense; $792 and $780 Inventory; $3,900 and $2,700 Marketable Securities; $2,580 and $300 Note Payable due in eighteen months; $6,700 and $6,500 Plant, Property, \& Equipment, net; $9,300 and $8,940 Prepaid expenses; $200 and $480 Retained Earnings; unknown and $1,320 Sales; $30,750 and $25,480 Selling and Administrative expenses; $1,590 and $1,560 Wages Payable; $400 and $300 Your job is to create two financial statements: the Income Statement and the Balance Sheet. Next, will use vertical analysis (common sized financial statements), horizontal analysis (both theA/ change in dollar amounts and percentage), and finally calculate the ratios/measurements listed below for both years. The ratios should be labeled and numbered one through ten. Make sure that dollar signs are used where appropriate, and that other markings such as percent signs are also applied when needed. Calculate to the second decimal place the following: Working Capital, Current Ratio, Acid-test Ratio, Accounts Receivable Turnover, Average Collection Period, Inventory Turnover, Debt-to-Equity Ratio, Gross Margin Percentage, Net Profit Margin Percentage, and Return on Assets. See the back side of this sheet for more detail on the expectations and requirementsStep by Step Solution
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