Loose-leaf for Fundamentals of Financial Accounting with Connect
5th Edition
ISBN: 9781259619007
Author: Fred Phillips Associate Professor
Publisher: McGraw-Hill Education
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Chapter 13, Problem 13.3E
1)
To determine
To Conduct: A Horizontal analysis by calculating the year-over-year changes of Incorporation CTand the effect of change in computer price comparing to the changes in Incorporation CT’s total revenue, cost of crude oil and products.
2)
To determine
vertical analysis by expressing each line as a percentage of total revenues and to find out whether Incorporation CT earned more sales in 20 l3 compared to 2012.
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7
According to the producer price index database maintained by the Bureau of Labor Statistics, the average
cost of computer equipment fell 3.8 percent between January and December 2016. Let's see whether these
changes are reflected in the income statement of Computer Tycoon Inc. for the year ended December 31,
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2016
2015
Sales Revenue
$113,000
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Вook
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Hint
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Net Income
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Required:
1. Compute the gross profit percentage for each year. Assuming that the change from 2015 to 2016 is the
beginning of a sustained trend, is Computer Tycoon likely to earn more or less gross profit from each
dollar of sales in 2017?
2. Compute the net profit margin for each year. Given your calculations here and in requirement 1, explain
whether Computer…
According to the producer price index database maintained by the Bureau of Labor Statistics, the average cost of computer equipment
fell 3.8 percent between January and December 2018. Let's see whether these changes are reflected in the income statement of
Wizard Computers for the year ended December 31, 2018.
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67,000
2017
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77,100
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63,900
37,400
39,800
640
545
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23,555
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1. Compute the times interest earned ratios for 2018 and 2017.
2. Does Wizard generate sufficient net income in both years (before taxes and interest) to cover the cost of debt financing?
Complete this question by entering your answers in the tabs below.
Required 1 Required 2
Compute the times interest earned ratios for 2018 and 2017. (Round your answers to 1 decimal place.)
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According to the producer price index database maintained by the Bureau of Labor Statistics, the average cost of computer equipment
fell 3.8 percent between January and December 2018. Let's see whether these changes are reflected in the income statement of
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Required 1
Required 2 Required 3
2018
$ 105,000
62,500
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1. Compute the gross profit percentage for each year. Assuming the change from 2017 to 2018 is the beginning of a sustained trend,
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Chapter 13 Solutions
Loose-leaf for Fundamentals of Financial Accounting with Connect
Ch. 13 - What is the general goal of trend analysis?Ch. 13 - Prob. 2QCh. 13 - What is ratio analysis? Why is it useful?Ch. 13 - What benchmarks are commonly used for interpreting...Ch. 13 - Prob. 5QCh. 13 - Prob. 6QCh. 13 - Slow Cellars current ratio increased from 1.2 to...Ch. 13 - From last year to this year, Colossal Companys...Ch. 13 - From last year to this year, Berry Bam reported...Ch. 13 - Explain whether the following situations, taken...
Ch. 13 - What are the two essential characteristics of...Ch. 13 - Prob. 12QCh. 13 - Prob. 13QCh. 13 - Prob. 14QCh. 13 - Prob. 15QCh. 13 - Prob. 16QCh. 13 - 1. Which of the following ratios is not used to...Ch. 13 - Prob. 2MCCh. 13 - Prob. 3MCCh. 13 - Analysts use ratios to a. Compare different...Ch. 13 - Which of the following ratios incorporates stock...Ch. 13 - Prob. 6MCCh. 13 - Prob. 7MCCh. 13 - A bank is least likely to use which of the...Ch. 13 - Prob. 9MCCh. 13 - (Supplement 13A) Which of the following items is...Ch. 13 - Calculations for Horizontal Analyses Using the...Ch. 13 - Calculations for Vertical Analyses Refer to M13-1....Ch. 13 - Interpreting Horizontal Analyses Refer to the...Ch. 13 - Interpreting Vertical Analyses Refer to the...Ch. 13 - Prob. 13.5MECh. 13 - Prob. 13.6MECh. 13 - Prob. 13.7MECh. 13 - Analyzing the Inventory Turnover Ratio A...Ch. 13 - Inferring Financial Information Using the Current...Ch. 13 - Prob. 13.10MECh. 13 - Identifying Relevant Ratios Identify the ratio...Ch. 13 - Prob. 13.12MECh. 13 - Analyzing the Impact of Accounting Alternatives...Ch. 13 - Describing the Effect of Accounting Decisions on...Ch. 13 - Prob. 13.1ECh. 13 - Prob. 13.2ECh. 13 - Prob. 13.3ECh. 13 - Computing Profitability Ratios Use the information...Ch. 13 - Prob. 13.5ECh. 13 - Matching Each Ratio with Its Computational Formula...Ch. 13 - Computing and Interpreting Selected Liquidity...Ch. 13 - Prob. 13.8ECh. 13 - Prob. 13.9ECh. 13 - Prob. 13.10ECh. 13 - Prob. 13.11ECh. 13 - Prob. 13.12ECh. 13 - Prob. 13.13ECh. 13 - Prob. 13.14ECh. 13 - Analyzing the Impact of Alternative Inventory...Ch. 13 - Prob. 13.1CPCh. 13 - Analyzing Comparative Financial Statements Using...Ch. 13 - Prob. 13.3CPCh. 13 - Prob. 13.4CPCh. 13 - Prob. 13.5CPCh. 13 - Prob. 13.6CPCh. 13 - Prob. 13.7CPCh. 13 - Prob. 13.1PACh. 13 - Analyzing Comparative Financial Statements Using...Ch. 13 - Prob. 13.3PACh. 13 - Prob. 13.4PACh. 13 - Interpreting Profitability, Liquidity, Solvency,...Ch. 13 - Using Ratios to Compare Loan Requests from Two...Ch. 13 - Prob. 13.7PACh. 13 - Prob. 13.1PBCh. 13 - Prob. 13.2PBCh. 13 - Prob. 13.3PBCh. 13 - Prob. 13.4PBCh. 13 - Interpreting Profitability, Liquidity, Solvency,...Ch. 13 - Using Ratios to Compare Loan Requests from Two...Ch. 13 - Prob. 13.7PBCh. 13 - Prob. 13.1SDCCh. 13 - Prob. 13.2SDCCh. 13 - Prob. 13.5SDCCh. 13 - Prob. 13.6SDCCh. 13 - Prob. 13.7SDCCh. 13 - Prob. 13.1CC
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