Financial Accounting: Tools for Business Decision Making, 8th Edition
8th Edition
ISBN: 9781118953808
Author: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso
Publisher: WILEY
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Chapter 5, Problem 5.2EYCT
(a) (1)
To determine
Annual Report is a comprehensive financial report that shows all the business activities, that takes place throughout the previous financial year. Its purpose is to provide the complete information of a company’s financial activities, to its users in order to help them analyze, and take well informed decisions.
The following are the values for Company CS and Company VF.
Profit margin measures the amount of net income earned from each dollar of sales revenue generated by a company. Thus, it shows the relationship between the net income, and net sales. It is calculated by using the following formula:
To Calculate: The profit margin for the year 2014 of Company CS and Company VF.
(2)
To determine
Gross profit represents the revenue after the deduction of cost of goods sold from the net sales of a business. Its mathematical representation is as below:
To Calculate: The gross profit for the year 2014 of Company CS and Company VF.
(3)
To determine
Gross profit rate is the financial ratio that shows the relationship between the gross profit on sales and net sales. Gross profit is the difference between the total revenue and the cost of goods sold. It is calculated by using the following formula:
To Calculate: The gross profit rate for the year 2014 of Company CS and Company VF.
(4)
To determine
Operating income is the difference between the gross profit (revenue minus cost of goods sold) and operating expenses incurred during a particular year.
To Determine: The operating income for 2014 of Company CS and Company VF.
(5)
To determine
Operating income is the difference between the gross profit (revenue minus cost of goods sold) and operating expenses incurred during a particular year.
To Compute: The percentage change in operating income from 2014 to 2013 for Company CS and Company VF.
(b)
To determine
To Conclude: The relative profitability of the two companies from the above data.
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Required:
1. Calculate the following profitability ratios for 2024:
2. Determine the amount of dividends paid to shareholders in 2024.
Required 1
a. Gross profit ratio
b. Return on assets
c. Profit margin
d. Asset turnover
e. Return on equity
%
%
%
2024
Complete this question by entering your answers in the tabs below.
times
%
$7,612,000
5,031,532
321,780
Required 1
$1,530,000
2,130,000
$3,660,000
$1,130,000
1,570,000
730,000
230,000
$3,660,000
Required 2
J
Calculate the following profitability ratios for 2024: (Round your answers to 1 decimal place.)
Profitability Ratios
2023
Required 2 >
$7,700,000
5,200,000
178,000
$1,430,000
1,830,000
$3,260,000…
Use the following tables to answer the question:
LOGIC COMPANY Income Statement For years ended December 31, 2016 and 2017
(values in $) 2016 2017
Gross sales 19,800 15,600
Sales returns and allowances 900 100
Net sales 18,900 15,500
COGS 11,800 8,800
Gross profit 7,100 6,700
Depreciation 780 640
Selling and administrative expenses 2,800 2,400
Research 630 540
Miscellaneous 440 340
Total operating expenses 4,650 3,920
Income before interest and taxes 2,450 2,780
Interest expense 640 540
Income before taxes 1,810 2,240
Provision for taxes 724 896
LOGIC COMPANY Balance Sheet For years ended December 31, 2016 and 2017
(values in $) 2016 2017
Current assets 12,300 9,400
Accounts receivable 16,900 12,900
Merchandise inventory 8,900 14,400
Prepaid expenses 24,400 10,400
Total current assets 62,500 47,100
Building (net) 14,900 11,400
Land 13,900 9,400
Total plant and equipment 28,800 20,800
Total assets 91,300 67,900
Accounts payable 13,400 7,400
Salaries payable 7,500 5,400
Total current…
You are a consultant for Glory Ltd, a quoted company operating in the manufacturing sector. Following are a Statement of Profit or Loss and Statement of Financial Position with comparatives for the year ended 31st December 2018.
2018
GHS
2017
GHS
Sales revenue
3,095,576
1,909,051
Cost of sales
2,402,609
1,441,950
Gross profit
692,967
467,101
Interest receivable
744
2,782
Administration expenses
333,466
222,872
Operating profit
360,245
247,011
Interest
18,115
21,909
Profit before taxation
342,130
225,102
Income tax expense
74,200
31,272
Profit for the year
267,930
193,830
Statement of Profit or Loss for the year ended 31st December, 2018
Statement of Financial Position as at 31 December 2018
Assets
2018
GHS
2017
GHS
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Chapter 5 Solutions
Financial Accounting: Tools for Business Decision Making, 8th Edition
Ch. 5 - Prob. 1QCh. 5 - Prob. 2QCh. 5 - Prob. 3QCh. 5 - Prob. 4QCh. 5 - Waymon Co. has net sales of 100,000, cost of goods...Ch. 5 - Masie Ascot believes revenues from credit sales...Ch. 5 - (a) What is the primary source document for...Ch. 5 - Prob. 8QCh. 5 - As the end of Smyle Companys fiscal year...Ch. 5 - To encourage bookstores to buy a broader range of...
Ch. 5 - Goods costing 1,900 are purchased on account on...Ch. 5 - Prob. 12QCh. 5 - Prob. 13QCh. 5 - Prob. 14QCh. 5 - Prob. 15QCh. 5 - Prob. 16QCh. 5 - Prob. 17QCh. 5 - What merchandising account(s) will appear in the...Ch. 5 - What types of businesses are most likely to use a...Ch. 5 - Prob. 20QCh. 5 - In the following cases, use a periodic inventory...Ch. 5 - Prob. 22QCh. 5 - What factors affect a companys gross profit...Ch. 5 - Prob. 24QCh. 5 - Prob. 25QCh. 5 - On July 15, a company purchases on account goods...Ch. 5 - Presented here are the components in Salas...Ch. 5 - Prob. 5.2BECh. 5 - Prob. 5.3BECh. 5 - Prob. 5.4BECh. 5 - Prob. 5.5BECh. 5 - Explain where each of these items would appear on...Ch. 5 - Prob. 5.7BECh. 5 - Prob. 5.8BECh. 5 - Prob. 5.9BECh. 5 - Prob. 5.10BECh. 5 - Prob. 5.11BECh. 5 - Prob. 5.12BECh. 5 - Prob. 5.13BECh. 5 - Prob. 5.14BECh. 5 - Prob. 5.1DIECh. 5 - Prob. 5.2DIECh. 5 - Prob. 5.3DIECh. 5 - Prob. 5.4DIECh. 5 - Prob. 5.5DIECh. 5 - Prob. 5.6DIECh. 5 - Prob. 5.1ECh. 5 - Assume that on September 1, Office Depot had an...Ch. 5 - Prob. 5.3ECh. 5 - Prob. 5.4ECh. 5 - Prob. 5.5ECh. 5 - Prob. 5.6ECh. 5 - Prob. 5.7ECh. 5 - Prob. 5.8ECh. 5 - Prob. 5.9ECh. 5 - Prob. 5.10ECh. 5 - Prob. 5.11ECh. 5 - Prob. 5.12ECh. 5 - Prob. 5.13ECh. 5 - Prob. 5.14ECh. 5 - Prob. 5.15ECh. 5 - Prob. 5.1APCh. 5 - Prob. 5.2APCh. 5 - Prob. 5.3APCh. 5 - Prob. 5.4APCh. 5 - Prob. 5.5APCh. 5 - Prob. 5.6APCh. 5 - Prob. 5.7APCh. 5 - Prob. 5.8APCh. 5 - Prob. 5.9APCh. 5 - Prob. 5.1CACRCh. 5 - Prob. 5.2CACRCh. 5 - Prob. 5.1EYCTCh. 5 - Prob. 5.2EYCTCh. 5 - Prob. 5.3EYCTCh. 5 - Prob. 5.4EYCTCh. 5 - Prob. 5.6EYCTCh. 5 - Prob. 5.7EYCTCh. 5 - Prob. 5.8EYCTCh. 5 - Prob. 5.9EYCTCh. 5 - Explain the difference between the...Ch. 5 - For each of the following income statement line...Ch. 5 - Prob. 5.3IFRSCh. 5 - Prob. 5.4IFRS
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