I need help with the attached assessment. I have attached the problems and the homework templates for each problem. Thanks

Assessment 2 Information, Parts 1-4 Part 1: Classified Balance Sheet The adjusted trial balance of Jordan Contracting and other related information for the year 2015 is presented below. Adjusted Trial Balance December 31, 2015 Debits Cash $20,500 Accounts Receivable 81,750 Allowance for Doubtful Accounts $4,350 Prepaid Insurance 2,950 Inventory 154,250 Long-term Investments 169,500 Land 42,500 Construction Work in Progress 62,000 Patents 18,000 Equipment 200,000 Accumulated Depreciation of Equipment Unamortized Discount on Bonds Payable Credits 70,000 10,000 Accounts Payable 74,000 Accrued Expenses 24,600 Notes Payable 47,000 Bonds Payable 200,000 Capital Stock 250,000 Premium on Capital Stock 22,500 Retained Earnings 69,000 $761,450 $761,450 1 Additional Information 1. The LIFO method of inventory valuation is used. 2. The cost and fair value of the long-term investments consisting of stock and bonds is the same. 3. The amount of Construction Work in Progress account represents the costs expended to date on a building in the process of being constructed. The land on which the building sits cost $42,500. 4. The patents were purchased at a cost of $10,000 and are being amortized on a straight-line basis. 5. $1,000 of the unamortized discount on bonds payable will be amortized in 2016. 6. The notes payable are bank loans secured by long-term investments with a fair value of $60,000. The bank loans will mature in 2016. 7. The bonds payable have an interest rate of 11%. Interest is payable each December 31, and the bonds mature January 1, 2019. 8. 600,000 shares of $1 par value common stock are authorized and 250,000 shares have been issued and are outstanding. Part 2: Income Statement Preparation Presented below is information related to D. B. Stanley Company for 2015. Retained earnings balance, January 1, 2015 $490,000 Sales for the year 12,500,000 Cost of goods sold 8,500,000 Interest revenue 35,000 Selling and administrative expenses 2,350,000 Write-off of goodwill (not tax deductible) 410,000 Income taxes for 2015 452,500 Gain on the sale of investments (normal recurring) 55,000 Loss due to flood damage-extraordinary item (net of tax) 195,000 Loss on the disposition of the wholesale division (net of tax) 220,000 Loss on operations of the wholesale division (net of tax) 45,000 Dividends declared on common stock 125,000 Dividends declared on preferred stock 35,000 2 Part 3: Cash Flow Statement Preparation and Analysis The financial statements of Falcon Company are found below. Comparative Balance Sheets December 31 Assets 2016 2015 Cash $13,000 $16,500 Accounts receivable 14,000 7,000 Merchandise inventory 19,000 12,500 Property, plant, and equipment $35,000 Less: Accumulated depreciation -13,500 Total $39,000 21,500 12,000 27,000 $67,500 $63,000 Accounts payable $15,500 $21,500 Income taxes payable 13,000 10,000 Bonds payable 10,000 5,000 Common stock 12,500 12,500 Retained earnings 16,500 14,000 Total $67,500 $63,000 Liabilities and Stockholders' Equity Falcon Company Income Statement For the Year Ended December 31, 2016 Sales $143,000 Cost of goods sold 97,000 Gross profit 46,000 3 Selling expenses $14,000 Administrative expenses 4,500 18,500 Income from operations 27,500 Interest expense 3,500 Income before income taxes 24,000 Income tax expense 3,500 Net income $20,500 Additional Information 1. Dividends of $18,000 were declared and paid. 2. During 2016 equipment was sold for $5,000 cash. The equipment originally cost $7,500 and had a book value of $5,000 at the time of the sale. 3. All depreciation expense, $4,000, was in the selling expense category. 4. All sales and purchases were on account. 5. Additional equipment was purchased for $3,500 cash. Part 4: Revenue Recognition Worth More Industries is split into two different divisionsClear Water Pools and Madoff Securities. Each operates with its own accounting system and revenue recognition method. Clear Water Pools For fiscal year ending November 30, 2015, Clear Water Pools worked on one construction project. They were awarded a contract for $1,500,000 on May 18, 2015, to construct a swimming pool, and the construction started on June 19, 2015. Their estimated completion costs were $1,250,000 for a 2-year time period that started at the date of the contract. On November 30, 2015, $390,000 of construction costs had been incurred and $475,000 progress billings had been made. On November 30, 2015, the construction costs to complete the project were reviewed and the estimated amount was $810,000, which was lower than projected. The change was due to a decline in raw material costs. Revenue recognition is based upon a percentage-of-completion method. Madoff Securities Madoff Securities uses manufacturers' agents who forward orders for alarm systems and the down payments. Madoff then ships their products from the factory to customers directly. The balance due is then billed directly to the customer, including shipping costs. Orders for $3,000,000 were received during the fiscal year ending November 30, 2015. Madoff received $300,000 in down payments; they billed $2,600,000 for goods and $50,000 in freight costs. Manufactures agents are paid a 10% commission on product price once goods are shipped to the customer. Madoff offers a 90-day warranty on goods after shipment, and the returns have been about 1% of sales. Revenue is recognized at the point of sale by this division. 4 5 Assessment 2 Template Use this template to complete Parts 1, 2, and 4 of Assessment 2. Part 1: Classified Balance Sheet. Jordan Contracting Company Balance Sheet December 31, 2015 Assets Current assets Long-term investments Property, plant, and equipment 1 Assessment 2 Template Intangible assets Liabilities and Stockholders' Equity Current liabilities Long-term liabilities Stockholders' equity 2 Assessment 2 Template Part 2: Income and Retained Earnings Statements D.B. Stanley Company Income Statement For the Year Ended December 31, 2015 3 Assessment 2 Template Part 2: Continued D.B. Stanley Company Retained Earnings Statement For the Year Ended December 31, 2015 4 Assessment 2 Template Part 4: Revenue Recognition 1. Explain each of the following methods of revenue recognition and indicate whether each is in accordance with generally accepted accounting principles. a. Point of sale: b. Completed-contract: c. Percentage-of-completion: d. Installment-sales: 2. Compute the revenue to be recognized in fiscal year 2015 for the two operating divisions of Worth More Industries in accordance with generally accepted accounting principles. Where appropriate, show all calculations leading to the final solution. Worth More Industries A. Clear Water Pools Construction Division B. Madoff Securities Division 5 Instructions for the Microsoft Excel Templates Be advised - The workbooks and sheets are not protected. Typing over information may result in the loss of th Detail and information on Excel is contained within the manual. Striking the "F1" key or following the path "Windows>Excel Help" will invoke the Office Assistant and bring up one of several help menus. Type your NAME into the cell "C2". This will be copied by formula to the rest of the pages as required. Type the COURSE & SECTION identifier into cell "C3". This will be copied by formula to the rest of the pag Type the DUE DATE of your problem into cell "C4". This will be copied by formula to the rest of the pages a The PROBLEM is identified for you in cell "B5". In "DATE" cells enter the date in any of several formats and Excel will format it correctly. If more than one page is preformatted into the problem, page breaks are preset and formulas are set to copy the header into the remaining pages. Place the proper account title in the cell where the word "Account" appears on the template. Place the amount in the cell where the word "Amount" appears on the template. A formula may be placed in cells. Enter a number like 914 to signify units or gallons where the word "Number" appears. Write a formula into cells where the word "Formula" appears. In these cells, an amount calculated outside of entered into Excel if desired. Place the explanation for the entry in the cell where the word "Explanation" appears on the template. Insert the account number where "Acct #" appears on the template during posting. Insert the journal reference where "Journ #" appears on the template during posting. Insert the title in the cell where "Title" appears on the template. FileName: 7c2971381ac80db317485649f74ad5a0bc517c17.xls, Tab Instructions, Page 1 of 5, 07/30/2017, 13:17:55 The print area is defined to fit onto 8 1/2" X 11" sheets in portrait or landscape mode as required. The gray filled cells define the perimeter of the problem and the print area. The problem is formatted for whole dollars with comma separations (no cents) except where required. The display may have "Freeze Pane" invoked so column titles remain visible during data entry. FileName: 7c2971381ac80db317485649f74ad5a0bc517c17.xls, Tab Instructions, Page 2 of 5, 07/30/2017, 13:17:55 Preparation and Analysis of Statement of Cash Flows (Preparation and Analysis of Statement of Cash Flows) Here are the financial statements of Falcon Company. Assets Cash Accounts receivable Merchandise inventory Property, plant, and equipment Less: Accumulated depreciation Total Liabilities and Stockholders' Equity Accounts payable Income taxes payable Bonds payable Common stock Retained earnings Total Falcon Company Comparative Balance Sheets December 31, 2016 2016 $13,000 14,000 19,000 $35,000 (13,500) 21,500 $67,500 2015 $16,500 7,000 12,500 $39,000 (12,000) $15,500 13,000 10,000 12,500 16,500 $67,500 27,000 $63,000 $21,500 10,000 5,000 12,500 14,000 $63,000 Falcon Company Income Statement For the Year Ended December 31, 2016 Sales Cost of goods sold Gross profit Selling expenses Administrative expenses Income from operations Interest expense Income before income taxes Income tax expense $143,000 97,000 46,000 $14,000 4,500 18,500 27,500 3,500 24,000 3,500 FileName: 7c2971381ac80db317485649f74ad5a0bc517c17.xls, Tab Falcon Company, Page 3 of 5, 07/30/2017, 13:17:55 Preparation and Analysis of Statement of Cash Flows Net income $20,500 Additional data: 1. Dividends of $18,000 were declared and paid. 2. During the year equipment was sold for $5,000 cash. This equipment cost originally and had a book value of $5,000 at the time of sale. 3. All depreciation expense, $4,000 , is in the selling expense category. 4. All sales and purchases are on account. 5. Additional equipment was purchased for $3,500 cash. Instructions: (a) Prepare a statement of cash flows using the indirect method. Falcon Company Statement of Cash Flows For the Year Ended December 31, 2016 Cash flows from operating activities $7,500 Adjustments to reconcile NI to net cash provided by operating activities Cash flows from investing activities Cash flows from financing activities FileName: 7c2971381ac80db317485649f74ad5a0bc517c17.xls, Tab Falcon Company, Page 4 of 5, 07/30/2017, 13:17:55 Preparation and Analysis of Statement of Cash Flows (b)(1) Compute the current cash debt coverage ratio. Current cash debt coverage ratio = Current cash debt coverage ratio = Current cash debt coverage ratio = (b)(2) Compute the cash debt coverage ratio. Cash debt coverage ratio Cash debt coverage ratio Cash debt coverage ratio (b)(3) Compute the free cash flow. Free cash flow = - - Free cash flow = - - Free cash flow = FileName: 7c2971381ac80db317485649f74ad5a0bc517c17.xls, Tab Falcon Company, Page 5 of 5, 07/30/2017, 13:17:55 Assessment 2 Template Use this template to complete Parts 1, 2, and 4 of Assessment 2. Part 1: Classified Balance Sheet. Jordan Contracting Company Balance Sheet December 31, 2015 Assets Current assets Cash 20,500 Accounts Receivables 81,750 Allowance for Doubtful Accounts -4,350 Prepaid Insurance 77,400 2,950 Inventory 154,250 Total Current Assets 255,100 Long-term investments Long Term Investments 169,500 Total Long term Investments 169,500 Property, plant, and equipment Land 42,500 Construction in Process Equipments Accumulated Depreciation of Equipments 62000 200,000 70,000 130,000 1 Assessment 2 Template Total Property, plant and equipment 234,500 Intangible assets Patent 18000 Total Intangible Assets 18000 Total Assets 677,100 Liabilities and Stockholders' Equity Current liabilities Accounts Payable 74,000 Accrued Expenses 24,600 Notes Payable 47,000 Total current liabilities 145600 Long-term liabilities Bonds Payable Unamortized Discount on Bonds Payable Total Long term Liabilities 200,000 10000 190,000 190,000 Stockholders' equity Capital Stock 250,000 Premium on Capital Stock 22,500 Retained Earnings 69,000 Total Liabilities and Stockholders' Equity 677,100 2 Assessment 2 Template Part 2: Income and Retained Earnings Statements D.B. Stanley Company Income Statement For the Year Ended December 31, 2015 Sales Revenue 12,500,000 Cost of Goods Sold 8,500,000 Gross Profit 4,000,000 Operating Expenses: Selling and Administrative Expenses 2,350,000 Writing off Goodwill Net Operating Income 410,000 1,940,000 Other Income/ (Expenses) Interest Revenue 35,000 Gain on Sale of Investment 55,000 Income Before taxes 2,030,000 Income taxes Net Income from Continuing Operations 452,500 1,577,500 195,000 Loss due to flood damage-extraordinary item (net of tax) 220,000 Loss on the disposition of the wholesale division (net of tax) 45,000 Loss on operations of the wholesale division (net of tax) Comprehensive Income (loss) 3 Assessment 2 Template Part 2: Continued D.B. Stanley Company Retained Earnings Statement For the Year Ended December 31, 2015 Balance January 1, 2015 490,000 Net Income for year 1,577,500 Dividends on Preferred Stock -35,000 Dividends on Common Stock -125,000 Balance December 31, 2015 1,907,500 4 Assessment 2 Template Part 4: Revenue Recognition 1. Explain each of the following methods of revenue recognition and indicate whether each is in accordance with generally accepted accounting principles. a. Point of sale: Under POS method of revenue recognition, revenue should be recorded in books when it is either realized or realizable and is earned. It is in accordance with generally accepted accounting principles as revenue should not be recorded till either it is earned or is received or there is no sign that it will not be received. b. Completed-contract: Under completed contract method revenue is realized on completion of contract. This method is used when there is uncertainty for either completion of contract or for payment of contract due to conditions of contract. It is in accordance with generally accepted accounting principles as revenue should not be recorded till there is conformity for receipt of revenue. c. Percentage-of-completion: Percentage of completion method is used in case of construction contracts which are completed in number of years. As part of work is completed and part payment is received, revenue should also be realized partly. It is in accordance with generally accepted accounting principles. d. Installment-sales: Under installment sale method revenue should be recognized for installments received because there is uncertainty for future installments to be received. It is in accordance with generally accepted accounting principles. 2. Compute the revenue to be recognized in fiscal year 2015 for the two operating divisions of Worth More Industries in accordance with generally accepted accounting principles. Where appropriate, show all calculations leading to the final solution. Worth More Industries A. Clear Water Pools Construction Division 5 Assessment 2 Template Revenue to be recognized = ((Contract Price- Estimated cost)/ Contract Price)*(billing-cost incurred) = ((1,500,000-1,200,000)/1,500,000)*(475,000-390,000) = $17,000 B. Madoff Securities Division Sales revenue to be recognized = 300,000+2,600,000 = $2,900,000 Freight Out= $50,000 Sales Commission = $290,000 6 Instructions for the Microsoft Excel Templates Be advised - The workbooks and sheets are not protected. Typing over information may result in the loss of th Detail and information on Excel is contained within the manual. Striking the "F1" key or following the path "Windows>Excel Help" will invoke the Office Assistant and bring up one of several help menus. Type your NAME into the cell "C2". This will be copied by formula to the rest of the pages as required. Type the COURSE & SECTION identifier into cell "C3". This will be copied by formula to the rest of the pag Type the DUE DATE of your problem into cell "C4". This will be copied by formula to the rest of the pages a The PROBLEM is identified for you in cell "B5". In "DATE" cells enter the date in any of several formats and Excel will format it correctly. If more than one page is preformatted into the problem, page breaks are preset and formulas are set to copy the header into the remaining pages. Place the proper account title in the cell where the word "Account" appears on the template. Place the amount in the cell where the word "Amount" appears on the template. A formula may be placed in cells. Enter a number like 914 to signify units or gallons where the word "Number" appears. Write a formula into cells where the word "Formula" appears. In these cells, an amount calculated outside of entered into Excel if desired. Place the explanation for the entry in the cell where the word "Explanation" appears on the template. Insert the account number where "Acct #" appears on the template during posting. Insert the journal reference where "Journ #" appears on the template during posting. Insert the title in the cell where "Title" appears on the template. FileName: 24c848f82e0fbb4ae3a2de03f3f2667b71de0687.xls, Tab Instructions, Page 1 of 5, 08/04/2017, 17:59:32 The print area is defined to fit onto 8 1/2" X 11" sheets in portrait or landscape mode as required. The gray filled cells define the perimeter of the problem and the print area. The problem is formatted for whole dollars with comma separations (no cents) except where required. The display may have "Freeze Pane" invoked so column titles remain visible during data entry. FileName: 24c848f82e0fbb4ae3a2de03f3f2667b71de0687.xls, Tab Instructions, Page 2 of 5, 08/04/2017, 17:59:32 Preparation and Analysis of Statement of Cash Flows (Preparation and Analysis of Statement of Cash Flows) Here are the financial statements of Falcon Company. Assets Cash Accounts receivable Merchandise inventory Property, plant, and equipment Less: Accumulated depreciation Total Liabilities and Stockholders' Equity Accounts payable Income taxes payable Bonds payable Common stock Retained earnings Total Falcon Company Comparative Balance Sheets December 31, 2016 2016 $13,000 14,000 19,000 $35,000 (13,500) 21,500 $67,500 2015 $16,500 7,000 12,500 $39,000 (12,000) $15,500 13,000 10,000 12,500 16,500 $67,500 27,000 $63,000 $21,500 10,000 5,000 12,500 14,000 $63,000 Falcon Company Income Statement For the Year Ended December 31, 2016 Sales Cost of goods sold Gross profit Selling expenses Administrative expenses Income from operations Interest expense Income before income taxes Income tax expense $143,000 97,000 46,000 $14,000 4,500 18,500 27,500 3,500 24,000 3,500 FileName: 24c848f82e0fbb4ae3a2de03f3f2667b71de0687.xls, Tab Falcon Company, Page 3 of 5, 08/04/2017, 17:59:32 Preparation and Analysis of Statement of Cash Flows Net income $20,500 Additional data: 1. Dividends of $18,000 were declared and paid. 2. During the year equipment was sold for $5,000 cash. This equipment cost originally and had a book value of $5,000 at the time of sale. 3. All depreciation expense, $4,000 , is in the selling expense category. 4. All sales and purchases are on account. 5. Additional equipment was purchased for $3,500 cash. Instructions: (a) Prepare a statement of cash flows using the indirect method. Falcon Company Statement of Cash Flows For the Year Ended December 31, 2016 Cash flows from operating activities Net Income $20,500 Adjustments to reconcile NI to net cash provided by operating activities Depreciation $4,000 Increase in Accounts Receivables (7,000) Increase in Merchandise Inventory (6,500) Decrease in Accounts Payable (6,000) Increase in Income Tax Payable 3,000 (12,500) Cash provided/ (used) by operating activities 8,000 Cash flows from investing activities Sale of Equipment Purchase of Equipment Cash provided/ (used) by investing activities Cash flows from financing activities Payment of Dividends Issue of bonds Cash provided/ (used) by financing activities Net Increase/ (Decrease) in cash Beginning Cash Balance Ending cash balance $7,500 5,000 (3,500) 1,500 (18,000) 5,000 (13,000) (3,500) 16,500 $13,000 FileName: 24c848f82e0fbb4ae3a2de03f3f2667b71de0687.xls, Tab Falcon Company, Page 4 of 5, 08/04/2017, 17:59:32 Preparation and Analysis of Statement of Cash Flows (b)(1) Compute the current cash debt coverage ratio. Current cash debt coverage ratio = Cash provided by operating activities Average current liabilities Current cash debt coverage ratio = $8,000 (28500+31500)/2 Current cash debt coverage ratio = 0.2666666667 (b)(2) Compute the cash debt coverage ratio. Cash debt coverage ratio Cash provided by operating activities Average total liabilities Cash debt coverage ratio $8,000 (38500+36500)/2 Cash debt coverage ratio 0.213 (b)(3) Compute the free cash flow. Free cash flow = Cash from operations - Purchase of long live assets - Dividends paid Free cash flow = $8,000 - $3,500 - $18,000 Free cash flow = ($13,500) FileName: 24c848f82e0fbb4ae3a2de03f3f2667b71de0687.xls, Tab Falcon Company, Page 5 of 5, 08/04/2017, 17:59:32