PROBLEM A: PREPARE FINANCIAL STATEMENTS

ABC COMPANY

Trial Balance

For the year ended, December 31, 2012

Cash 198,000

Accounts receivable 300,000

Inventories 78,000

Prepaid insurance 4,000

Supplies 2,000

Furnitures and fixtures 100,000

Accumulated depreciation, furnitures & fixtures 60,000

Building 250,000

Accumulated depreciation, building 140,000

Accounts payable 310,000

Salaries payable 5,000

Unearned service revenue 13,000

Notes payable ($12,000 due in the current year) 40,000

Mortgage payable (1/3 due in the current year) 30,000

Retained earnings (beginning) 293,000

Dividends 65,000

Service revenue 300,000

Professional fees revenue 30,000

Salary expense 170,000

Supplies expense 4,000

Depreciation expense, furnitures & fixtures 20,000

Depreciation expense, building 11,000

Rent expense 9,000

Interest expense 7,000

Utilities expense 3,000

REQUIRED: (USE CORRECT FORMAT)

Prepare a trial balance

Prepare an income statement

Prepare a statement of retained earnings

Prepare a CLASSIFIED balance sheet

PROBLEM B: (PLEASE FOLLOW INSTRUCTIONS)

fiscal year ended 2013.

https://corporate.target.com/_media/TargetCorp/annualreports/content/download/pdf/Target-2013-Annual-Report.pdf?ext=.pdf (You may also google this if the link does not work.)

REQUIRED: (State which company you are using, i.e. PROBLEM B: GOOGLE. SHOW CALCULATIONS/NUMBERS USED IN CALCULATIONS AND LABEL ACCORDINGLY. USE 2 DECIMAL PLACES)

USE THE CONSOLIDATE FINANCIAL STATEMENTS

Calculate the following:

Current ratio, briefly explain what your final answer means

Quick ratio, briefly explain what your final answer means

Inventory turnover, briefly explain what your final answer means

Debt ratio, briefly explain what your final answer means

Rate of return on net sales, briefly explain what your final answer means

Vertical analysis of the most current periods current assets

Horizontal analysis of total revenue

Horizontal analysis of net income (use 2 or 3 years)

PROBLEM C: PREPARE A STATEMENT OF CASH FLOWS (INDIRECT METHOD)

XYZ Corporation

Income Statement

Year Ended December 31, 2005

Sales revenue $662,000

Cost of goods sold 560,000

Gross profit 102,000

Operating expenses:

Salary expense $46,000

Depreciation expense 10,000

Rent expense 2,000

Total operating expenses 58,000

Income from operations 44,000

Other items:

Loss on sale of equipment (2,000)

Income before income tax 42,000

Income tax expense 16,000

Net income $26,000

XYZ Corporation

Balance Sheet

December 31, 2005 and 2004

Assets 2005 2004

Current:

Cash and equivalents $ 22,000 $ 3,000

Accounts receivable 22,000 23,000

Inventories 35,000 34,000

Total current assets 79,000 60,000

Equipment, net 126,000 72,000

Total assets $205,000 $132,000

Liabilities 2005 2004

Current:

Accounts payable $ 35,000 $ 26,000

Accrued liabilities 7,000 9,000

Income tax payable 10,000 $ 10,000

Total current liabilities 52,000 45,000

Bonds payable 84,000 53,000

Owners Equity 2005 2004

Common stock 52,000 20,000

Retained earnings 27,000 19,000

Less: Treasury stock (10,000) (5,000)

Total liabilities and equity $205,000 $132,000

Transaction Data for 2005:

Purchase of equipment $140,000

Payment of dividends 18,000

Issuance of common stock to retire bonds payable 13,000

Issuance of bonds payable to borrow cash 44,000

Issuance of common stock 19,000

Sale of equipment (book value, $76,000) 74,000

Purchase of treasury stock 5,000

LAST NAMES BEGINNING WITH LETTER - A THRU G PROBLEM A: PREPARE FINANCIAL STATEMENTS ABC COMPANY Trial Balance For the year ended, December 31, 2012 Cash Accounts receivable Inventories Prepaid insurance Supplies Furnitures and fixtures Accumulated depreciation, furnitures & fixtures Building Accumulated depreciation, building Accounts payable Salaries payable Unearned service revenue Notes payable ($12,000 due in the current year) Mortgage payable (1/3 due in the current year) Retained earnings (beginning) Dividends Service revenue Professional fees revenue Salary expense Supplies expense Depreciation expense, furnitures & fixtures Depreciation expense, building Rent expense Interest expense Utilities expense REQUIRED: (USE CORRECT FORMAT) 1) Prepare a trial balance 2) Prepare an income statement 3) Prepare a statement of retained earnings 4) Prepare a CLASSIFIED balance sheet 198,000 300,000 78,000 4,000 2,000 100,000 60,000 250,000 140,000 310,000 5,000 13,000 40,000 30,000 293,000 65,000 300,000 30,000 170,000 4,000 20,000 11,000 9,000 7,000 3,000 LAST NAMES BEGINNING WITH LETTER - A THRU G PROBLEM B: (PLEASE FOLLOW INSTRUCTIONS) fiscal year ended 2013. https://corporate.target.com/_media/TargetCorp/annualreports/content/download/pdf/Targ et-2013-Annual-Report.pdf?ext=.pdf (You may also google this if the link does not work.) REQUIRED: (State which company you are using, i.e. PROBLEM B: GOOGLE. SHOW CALCULATIONS/NUMBERS USED IN CALCULATIONS AND LABEL ACCORDINGLY. USE 2 DECIMAL PLACES) USE THE CONSOLIDATE FINANCIAL STATEMENTS Calculate the following: 1) Current ratio, briefly explain what your final answer means 2) Quick ratio, briefly explain what your final answer means 3) Inventory turnover, briefly explain what your final answer means 4) Debt ratio, briefly explain what your final answer means 5) Rate of return on net sales, briefly explain what your final answer means 6) Vertical analysis of the most current period's current assets 7) Horizontal analysis of total revenue 8) Horizontal analysis of net income (use 2 or 3 years) LAST NAMES BEGINNING WITH LETTER - A THRU G PROBLEM C: PREPARE A STATEMENT OF CASH FLOWS (INDIRECT METHOD) XYZ Corporation Income Statement Year Ended December 31, 2005 Sales revenue Cost of goods sold Gross profit Operating expenses: Salary expense Depreciation expense Rent expense Total operating expenses Income from operations Other items: Loss on sale of equipment Income before income tax Income tax expense Net income $662,000 560,000 102,000 $46,000 10,000 2,000 58,000 44,000 (2,000) 42,000 16,000 $26,000 XYZ Corporation Balance Sheet December 31, 2005 and 2004 Assets Current: Cash and equivalents Accounts receivable Inventories Total current assets Equipment, net $ 22,000 22,000 35,000 79,000 126,000 Total assets $205,000 Liabilities Current: Accounts payable Accrued liabilities Income tax payable Total current liabilities Bonds payable 2005 2004 $ 3,000 23,000 34,000 60,000 72,000 $132,000 2005 $ 35,000 7,000 10,000 52,000 84,000 2004 $ 26,000 9,000 $ 10,000 45,000 53,000 LAST NAMES BEGINNING WITH LETTER - A THRU G Owners' Equity Common stock Retained earnings Less: Treasury stock Total liabilities and equity 2005 52,000 27,000 (10,000) $205,000 2004 20,000 19,000 (5,000) $132,000 Transaction Data for 2005: Purchase of equipment $140,000 Payment of dividends Issuance of common stock to retire bonds payable Issuance of bonds payable to borrow cash Issuance of common stock Sale of equipment (book value, $76,000) Purchase of treasury stock 18,000 13,000 44,000 19,000 74,000 5,000