Accounting: What the Numbers Mean
11th Edition
ISBN: 9781259535314
Author: David Marshall, Wayne William McManus, Daniel Viele
Publisher: McGraw-Hill Education
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Chapter 4, Problem 4.24P
Problem 4.24
LO 6. 7
Calculate income from operations and net income Selected information taken from the financial statements of Fordstar Co. for the year ended December 31, 2016, follows:
| Net cash provided by operations | $ 24,000 |
| Cost of goods sold | 78,000 |
| Selling, general, and administrative expenses | 31,000 |
| Accounts payable | 22,000 |
| Dividends paid | 34,000 |
| Research and development expenses | 8,000 |
| Merchandise inventory | 43,000 |
| Provision for income taxes | 19,000 |
| Net Sales | 210,000 |
| Interest expense | 16,000 |
- Calculate income from operations (operating income) for the year ended December 31, 2016. (Hint; You may wish to review Exhibit 2-2.}
- Calculate net income for the year ended December 31, 2016.
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Students have asked these similar questions
10: Application of Financial Ratios Used to Measure Profitability
The income statement of Garnet Mfg. Corp. for 2018 shows the following:
Sales, net
P 700,000
15,000
400,000
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Cost of goods sold
Cost of goods manufactured
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410,000
150,000
225,000
90,000
212,500
20,000
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The balance sheet figures as of December 31, 2017 and 2018 are as follows:
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2018
P12,500
P 25,000
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17,500
28,750
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20,000
Accounts receivable, net
Inventories:
25,000
35,000
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22,500
15,000
3,750
P 150,000
37,500
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P95,000
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187,500
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CABOT CORPORATION
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For Current Year Ended December 31
Sales
$ 448,600
297,150
151,450
98,600
5,000
47,850
19,276
$ 28,574
Cost of goods sold
Gross profit
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Interest expense
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Accounts receivable, net
Merchandise inventory
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Total assets
Req 1 and 2 Req 3
Req 4
CABOT CORPORATION
Balance Sheet
December 31
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Req 5
8,000 Accounts payable
8,800 Accrued wages payable
32,400
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Complete this question by entering your answers in the tabs below.
Compute the current ratio and acid-test ratio.
36,150 Long-term note payable, secured by
mortgage on property, plant and
equipment
Required:
Compute the following: (1) current ratio, (2) acid-test ratio, (3) days' sales uncollected, (4) inventory turnover, (5) days'…
Question 7
Comparative financial statement data for Cullumber Company and Crane Company, two competitors, appear below. All balance sheet data are as of December 31,
2017.
Cullumber
Crane
Company
Company
2017
2017
Net sales
$2,700,000
$930,000
Cost of goods sold
1,762,500
510,000
Operating expenses
424,500
147,000
Interest expense
13,500
5,700
Income tax expense
127,500
54,000
Current assets
411,100
194,636
Plant assets (net)
798,000
209,592
Current liabilities
99,488
50,574
Long-term liabilities
162,750
61,026
Net cash provided by operating activities
207,000
54,000
Capital expenditures
135,000
30,000
Dividends paid on common stock
54,000
22,500
Weighted-average number of shares outstanding
80,000
50,000
Chapter 4 Solutions
Accounting: What the Numbers Mean
Ch. 4 - Prob. 4.1MECh. 4 - Mini-Exercise 4.2 LO 2, 6, 7 Record transactions...Ch. 4 - Prob. 4.3MECh. 4 - Prob. 4.4MECh. 4 - Exercise 4.5 LO 2. 6, 7 Record transactions and...Ch. 4 - Exercise 4.6 LO 2. 6, 7 Record transactions and...Ch. 4 - Exercise 4.7 LO 6 Write journal entries Write the...Ch. 4 - Exercise 4.8 LQ 6 Write journal entries Write the...Ch. 4 - Exercise 4.9 LO 2, 6, 7 Record transactions and...Ch. 4 - Exercise 4.10 LO 2. 6, 7 Record transactions and...
Ch. 4 - Exercise 4.11 LO 2. 6, 7 Record transactions and...Ch. 4 - Exercise 4.12 LO 2, 6, 7 Record transactions and...Ch. 4 - Exercise 4.13 LO 3 Calculate retained earnings On...Ch. 4 - Prob. 4.14ECh. 4 - Exercise 4.15 LO 6 . 7 Notes receivable-interest...Ch. 4 - Exercise 4.16 LO 6, 7 Notes payable-interest...Ch. 4 - Exercise 4.17 LO 6, 7 Effect of adjustments on net...Ch. 4 - Exercise 4.18 LO 6, 7 Effects of adjustments A...Ch. 4 - Exercise 4.19 LO 6 , 7 T-account analysis Answer...Ch. 4 - Exercise 4.20 LO 6, 7 Transaction analysis using...Ch. 4 - Problem 4.21 LO 2, 6, 7 Record transactions and...Ch. 4 - Prob. 4.22PCh. 4 - Prob. 4.23PCh. 4 - Problem 4.24 LO 6. 7 Calculate income from...Ch. 4 - Prob. 4.25PCh. 4 - Prob. 4.26PCh. 4 - Problem 4.27 LO 6. 7 Analyze several accounts...Ch. 4 - Prob. 4.28PCh. 4 - Case 4.29LO 6, 7Capstone analytical review of...Ch. 4 - Prob. 4.30C
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