FUND.ACCT.PRIN.
25th Edition
ISBN: 9781260247985
Author: Wild
Publisher: RENT MCG
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Chapter 1, Problem 8PSB
(1)
To determine
Introduction: The financial statements of a company include balance sheets, income statements, and
To prepare:
(2)
To determine
Introduction: The financial statements of a company include balance sheets, income statements, and cash flow statements. All these statements help the internal and external users of financial statements help in analyzing and concluding the financial position of the respective company.
To compute: The net income for the period.
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T Account entries for Simple Construction:Bob Simple graduated from the BCIT Construction Management Program and decided to start his own construction company. We will record various entries that might be made in a T account sheet in order to account for his second year of operations. At the end of the first year, his income statement and balance sheet havethe following values:Balance Sheet Entries for Last Year:Cash: 365,000Accounts Receivable: $17,000Materials Inventory: $2000Equipment: $15,000Accumulated Amortization: $500Accounts Payable: $22,000Bank Loan –Long Term: $10,000Dividend Payable: $35,000Interest Payable: $500Wages Payable: $5,000Common Stock: $250,000Retained Earnings: $76,000Income statement Final Entries for Last Year:Revenue: $145,000Materials Expense: $20,000Wages Expense: $10,000Amortization Expense: $500Rental Expense: $2,500Interest Expense: $1000Net Income: $111,000
Question 1a.Enter the relevant amounts in the T sheet to start the current year, and designate…
Analyze Deere & Company
Deere & Company (DE) manufactures and distributes farm and construction machinery that it sells around the world. In addition to its manufacturing operations, Deere's credit division loans money to customers to finance the purchase of their farm and construction equipment.
The following information is available for three recent years (in millions except per-share amounts):
Year 3 Year 2 Year 1
Net income (loss)
$1,523.9 $1,940.0 $3,161.7
Preferred dividends
$ 0.00
$ 763.7 $ 680.0 $ 664.0
$ 0.00
$0.00
Interest expense
Shares outstanding for computing earnings per share
315
334
363
Cash dividend per share
$ 2.40
$ 2.40
$ 2.22
$ 57,965 $ 59,642 $ 60,429
$ 6,644 $ 7,912 $ 9,667
$ 92.03 $ 81.10 $ 85.58
Average total assets
Average stockholders' equity
Average stock price per share
1. Calculate the following ratios for each year (Round ratios and percentages to one decimal place, except for per-share amounts. Round per-share amounts to two decimal places.):
Year 3…
a. Received $60,000 cash from the investors who organized Down, Incorporated
b. Borrowed $20,000 cash and signed a note due in two years.
c. Ordered equipment costing $16,000.
d. Purchased $9,000 in equipment, paying $2,000 in cash and signing a six-month note for the balance.
e. Received the equipment ordered in (c), paid for half of it, and put the rest on account.
3. Prepare a classified balance sheet at May 31. Include Retained Earnings with a balance of zero.
Current Assets
Cash
Total Current Assets
Equipment
Total Assets
Assets
DOWN.INCORPORATED
Balance Sheet
At May 31
$
70,000
70,000
25,000
Liabilities
Current Liabilities
Common Stock
Notes Payable (long-term)
$ 95,000
$
$
60,000
20,000
80,000
80,000
0
80,000
Chapter 1 Solutions
FUND.ACCT.PRIN.
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