Accounting: What the Numbers Mean
11th Edition
ISBN: 9781259535314
Author: David Marshall, Wayne William McManus, Daniel Viele
Publisher: McGraw-Hill Education
expand_more
expand_more
format_list_bulleted
Concept explainers
Videos
Textbook Question
Chapter 16, Problem 16.39C
Capital budget expenditure analysis: Internet assignment Annual reports provide significant information about an organization’s capital budget and capital budgeting process. Campbell Soup Company provides financial reports for several years at campbellsoup.com {Our Company ? Investor Center ? Financial Information ? Annual Reports'). This exercise requires you to use Campbell’s consolidated statements of cash flows, management’s discussion and analysis of financial condition and results of operations, and notes to the consolidated financial statements for the most recent year presented.
Required:
Using Campbell’s most recent annual report, answer the following:
- From Campbell’s consolidated statements of cash flows:
- Identify the amount of cash used for capital expenditures from the Investing Activities section. How much cash was provided from the sale of capital assets?
- How do these amounts compare to the previous two years? Comment on the trend relative to the general cash flow position for each year.
- Read Campbell’s discussion of the “Business,” and highlight the information provided about capital expenditures reported in the current year and any plans identified for next year.
- Read Campbell’s discussion of the “Risk Factors.” How may the company be adversely impacted by failure to execute acquisitions and divestitures successfully?
- Read Campbell’s management’s discussion and analysis of financial condition and results of operations.
- In the Liquidity' and Capital Resources section, how were investing cash flows used or provided for capital expenditures?
- In the Significant Accounting Estimates section, how are fixed assets reviewed for impairment? What role does management judgment play?
- From Campbell’s notes to the consolidated financial statements, determine the following:
- How does Campbell’s value and
depreciate property, plant, and equipment? - If applicable, describe Campbell’s acquisitions for the year.
- If applicable, describe Campbell’s divestitures for the year.
- How were Campbell’s capital expenditures distributed among its business segments?
- From Campbell’s selected financial data, do the following:
- For the five years presented, calculate the ratio of capital expenditures to net sales.
- For the five years presented, calculate the ratio of net plant assets to total assets.
- Comment on the trends.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Printing Supply of Baltimore has applied for a loan. Its bank has requested a budgeted income statement for
April
2024
and budgeted balance sheet at
April
30,
2024.
The
March
31,
2024,
balance sheet follows:
As
Tune
Printing Supply's controller, you have assembled the following additional information:
a.
April
dividends of
$6,000
were declared and paid.
b.
April
capital expenditures of
$16,200
budgeted for cash purchase of equipment.
c.
April
depreciation expense,
$500.
d.
Cost of goods sold,
45%
of sales.
e.
Desired ending inventory for
April
is
$22,800.
f.
April
selling and administrative expenses include salaries of
$32,000,
30%
of which will be paid in cash and the remainder paid next month.
g.
Additional
April
selling and administrative expenses also include miscellaneous expenses of
15%
of sales, all paid in
April.
h.
April
budgeted sales,
$86,000,
50%
collected in
April
and
50%
in
May.
i.
April…
please answer within the format by providing formula the detailed workingPlease provide answer in text (Without image)Please provide answer in text (Without image)Please provide answer in text (Without image)
QUESTION 2
In the late June of each year, BOS Global Ltd prepares a cash budget for the next 6 months. The entity’s management wishes to prepare a cash budget in order to assess its likely requirements for short-term funds.
Actual sales for May, and estimated sales for June, and for the next 7 months are as follows:
Months
Sales Revenues (Actual and Estimates) [GHS]
Months
Sales Revenues (Actual and Estimates) [GHS]
May
20,000
September
50,000
June
28,000
October
94,000
July
24,000
November
74,000
August
26,000
December
52,000
January
40,000
Approximately 25 per cent of sales are for cash and 75 per cent are on credit. Past experience has shown that two-third of all credit sales are collected in the month immediately following the month…
Tune Printing Supply of Baltimore has applied for a loan. Its bank has requested a budgeted income statement for April 2024 and budgeted balance sheet at April 30, 2024. The March 31, 2024, balance sheet follows:
As Tune Printing Supply's controller, you have assembled the following additional information:
a.
April dividends of $6,000 were declared and paid.
b.
April capital expenditures of $16,200 budgeted for cash purchase of equipment.
c.
April depreciation expense, $500.
d.
Cost of goods sold, 45% of sales.
e.
Desired ending inventory for April is $22,800.
f.
April selling and administrative expenses include salaries of
$32,000, 30% of which will be paid in cash and the remainder paid next month.
g.
Additional April selling and administrative expenses also include miscellaneous expenses of 15% of sales, all paid in April.
h.
April budgeted sales, $86,000, 50% collected in April and 50% in May.
i.
April cash payments of…
Chapter 16 Solutions
Accounting: What the Numbers Mean
Ch. 16 - Prob. 16.1MECh. 16 - Prob. 16.2MECh. 16 - Mini-Exercise 16.3 LO 2. 3 The make or buy...Ch. 16 - Prob. 16.4MECh. 16 - Mini-Exercise 16.5 LO 7 Net present ratio and IRR...Ch. 16 - Mini-Exercise 16.6 LO 9. 10 Payback period and...Ch. 16 - Exercise 16.7 LO 1 Application of cost terminology...Ch. 16 - Prob. 16.8ECh. 16 - Exercise 16.9 LO 2, 3 Sell or process further?...Ch. 16 - Exercise 16.10 LO 2. 3 Sell or process further?...
Ch. 16 - Exercise 16.11
LO 2 , 3
Accept special sales...Ch. 16 - Exercise 16.12
LO 2, 3
Accept special sales order?...Ch. 16 - Prob. 16.13ECh. 16 - Exercise 16.14
LO 2, 3
Target costing Rainbow...Ch. 16 - Exercise 16.15
LO 2. 3
The make or buy decision...Ch. 16 - Exercise 16.16
LO 2, 3
The make or buy decision...Ch. 16 - Prob. 16.17ECh. 16 - Prob. 16.18ECh. 16 - Prob. 16.19ECh. 16 - Prob. 16.20ECh. 16 - Prob. 16.21ECh. 16 - Prob. 16.22ECh. 16 - Prob. 16.23ECh. 16 - Prob. 16.24ECh. 16 - Prob. 16.25ECh. 16 - Prob. 16.26ECh. 16 - Prob. 16.27PCh. 16 - Problem 16.28 LO 2, 3 Relevant costs, special...Ch. 16 - Problem 16.29 LO 2, 3 Continue or discontinue a...Ch. 16 - Prob. 16.30PCh. 16 - Prob. 16.31PCh. 16 - Prob. 16.32PCh. 16 - Prob. 16.33PCh. 16 - Prob. 16.34PCh. 16 - Prob. 16.35PCh. 16 - Prob. 16.36PCh. 16 - Prob. 16.38CCh. 16 - Capital budget expenditure analysis: Internet...
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Relevant data from the operating budget of The Framers are: Other data: Capital assets were sold in quarter 1 and $8,000 was collected in quarter 1 and $500 collected in quarter 2. Dividends of $500 will be paid in May The beginning cash balance was $50,000 and a required minimum cash balance is $10,000. Prepare a cash budget for the first two quarters of the year.arrow_forwardI have a finance team at work. As the year progresses, they need to maintain a record of cash flow and expenditure. What will they be required to do as a first step to building a budget? Question 1Select one: A. Find out the balance sheet of the company B. Find the profit and loss for the previous year C. Identify the expenditure and demand along with the cash flow of the company D. Build an income and expenditure statement Incorrectarrow_forwardRequired: A) The business needs to have a sense of its future cash flows and therefore requires the preparation of the following: ▪ A cash budget, with a total column, for the quarter ending March 31, 2022, showing the expected cash receipts and payments for each month and the ending cash balance for each of the three months, given that no financing activities took place. B) Another team member who is preparing the Budgeted Balance Sheet for the business for the same quarter ending March 31, 2022 and has asked you to furnish him with the figures for the expected trade receivables and payables to be included in the statement. Is that a reasonable request? If yes, what should these amounts be? C) Upon receipt of the budget, the team manager, June Jackson, has now informed you that, in keeping with industry players, the management of Pelican Merchandising have indicated an industry requirement to maintain a minimum cash balance of $185,000 each month. She has also noted that management is…arrow_forward
- https://www.republictt.com/pdfs/annual-reports/RFHL-Annual-Report-2022.pdf Working Capital Management: Use Republic Bank Limited Annual Report 2022 to answer the Questions. Assess the company’s working capital position by analyzing its current assets and liabilities using common methods and measures. Evaluate the efficiency of the company’s working capital management strategies, including inventory management, accounts receivable, and accounts payable. Based on your assessment and evaluation above, provide brief recommendations in point form for improving the company’s working capital management practices.arrow_forwardThe final step in the budgeting process is to draw up the budgeted statement of financial position at the end of the budgeted period. This statement summarizes the assets and liabilities of an entity at the end of an accounting period whether actual or budgeted. A snapshot of an entity financial situation. We have looked at all the numbers that will go into Bud's statement of financial position when we prepared the budgeted income statement and budgeted cash flow forecast. Now, it is time to indicate all of these in the final balance sheet. Non-current asset Machinery and tools Insurance prepayment Rates prepayment Cash at bank Total current assets Total assets From the above information, can you produce the budgeted statement of financial position? Current liabilities Trade payables for wood Budgeting.arrow_forwardONLY ANSWER QUESTION (B) AS I HAVE ANSWER FOR (A) ALREADY SALLAT Household Furnishings & Appliances is a family-owned business. You are themanagement accountant of the entity and have been given the task of preparing the cash budgetfor the business for the quarter ending September 30, 2022. Your data collection has yielded thefollowing:i) Extracts from the sales and purchases budgets are as follows:Month CashSales SalesOn Account CashPurchases PurchasesOn AccountMay $75,000 $480,000 $390,000June $135,000 $600,000 $36,000 $360,000July $86,800 $720,000 $61,700 $450,000August $105,600 $640,000 $68,800…arrow_forward
- Explain and give example of the following Management Reports Procedures Activities: Six Week Cash Flow Reportarrow_forwardhttps://www.republictt.com/pdfs/annual-reports/RFHL-Annual-Report-2022.pdf (Use the link the answer the question below) Working Capital Management : Use Republic Bank Limited Annual Report 2022 to answer the Questions. Assess the company’s working capital position by analyzing its current assets and liabilities using common methods and measures. Evaluate the efficiency of the company’s working capital management strategies, including inventory management, accounts receivable, and accounts payable. Based on your assessment and evaluation above, provide brief recommendations in point form for improving the company’s working capital management practices.arrow_forwardowa Imaging Center provided the financial information in Exhibit 5.15 below. Prepare a cash budget for the quarter ending March 20X1. For Blackboard you will enter your ENDING cash balance for the months of January 20X1, February 20X1, March 20X1, and the Quarter ending March 20X1. I want you to submit your work for this problem by email so I can review the entire document. Exhibit 5-15 Iowa Imaging Center Givens Revenues and Expenses Patient Revenues, 20X0 Estimated Patient Revenues, 20X1 Given 1 October $4,000,000 Given 2 January $4,300,000 November $4,200,000 February $4,350,000 December $4,300,000 March $4,400,000 Other Revenues, 20X1 Estimated Cash Outflows, 20X1a Given 3 January $90,000 Given 4 January $4,250,000…arrow_forward
- The Capital Expenditures Budget lays out the company's plans to maintain capital assets such as property, plant, and equipment. purchase capital assets such as property, plant, and equipment. sell capital assets such as property, plant, and equipment. If a company expects to earn $600,000 in revenues in a given month, they should expect to collect $600,000 in cash as well. True Falsearrow_forwardA company has completed the operating budget and the cash budget. It is now preparing the budgeted balance sheet. Please use the below image as your guide for the next 5 questions. Identify the document that contains cash balance.* A B C D Earrow_forwardA master budget: choose one Is an integrated set of budgets consisting of budgets related to operating , investing , and financing activities . Begins with the development of next year's cash budget . Is a single, large budget for all the expected future cash flows of the company . Is the company's five- year plan for financing and investing activities .arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Excel Applications for Accounting PrinciplesAccountingISBN:9781111581565Author:Gaylord N. SmithPublisher:Cengage Learning
Principles of Accounting Volume 2AccountingISBN:9781947172609Author:OpenStaxPublisher:OpenStax College
Excel Applications for Accounting Principles
Accounting
ISBN:9781111581565
Author:Gaylord N. Smith
Publisher:Cengage Learning
Principles of Accounting Volume 2
Accounting
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax College
Responsibility Accounting| Responsibility Centers and Segments| US CMA Part 1| US CMA course; Master Budget and Responsibility Accounting-Intro to Managerial Accounting- Su. 2013-Prof. Gershberg; Author: Mera Skill; Rutgers Accounting Web;https://www.youtube.com/watch?v=SYQ4u1BP24g;License: Standard YouTube License, CC-BY