Managerial Accounting 1B
Financial and Managerial Accounting
Chapter 13
1.
Exercise 13-3 Computation and analysis of trend percents L.O. P1
2013
2012
2011
2010
2009
Sales
$ 283,880
$ 271,800
$ 253,680
$ 235,560
$ 151,000
Cost of goods sold
129,200
123,080
116,280
107,440
68,000
Accounts receivable
19,100
18,300
17,400
16,200
10,000
Compute trend percents for the above accounts, using 2009 as the base year. (Omit the “%” sign in your response.)
2.
Exercise 13-7 Common-size percents L.O. P2
Sanderson Company’s year-end balance sheets follow.
At December 31
2012
2011
2010
Assets
Cash
$
30,800
$
35,625
$
36,800
Accounts receivable, net
88,500
62,500
49,200
Merchandise inventory
111,500
82,500
53,000
Prepaid expenses
9,700
9,375
4,000
Plant assets, net
277,500
255,000
229,500
Total assets
$
518,000
$
445,000
$
372,500
Liabilities and Equity
Accounts payable
$
128,900
$
75,250
$
49,250
Long-term notes payable secured by mortgages on plant assets
97,500
102,500
82,500
Common stock, $10 par value
162,500
162,500
162,500
Retained earnings
129,100
104,750
78,250
Total liabilities and equity
$
518,000
$
445,000
$
372,500
Express the balance sheets in common-size percents. (Do not round intermediate calculations and round your final answers to 1 decimal place. Omit the “%” sign in your response.)
Exercise 13-9 Liquidity analysis and interpretation L.O. P3
[The following information applies to the questions displayed below.]
Sanderson Company’s year-end balance sheets follow.
At December 31
2012
2011
2010
Assets
Cash
$
30,800
$
35,625
$
36,800
Accounts receivable, net
88,500
62,500
49,200
Merchandise inventory
111,500
82,500
53,000
Prepaid expenses
9,700
9,375
4,000
Plant assets, net
277,500
255,000
229,500
Total assets
$
518,000
$
445,000
$
372,500
Liabilities and Equity
Accounts payable
$
128,900
$
75,250
$
49,250
Long-term notes payable secured by mortgages on plant assets
97,500
102,500
82,500
Common stock, $10 par value
162,500
162,500
162,500
Retained earnings
129,100
104,750
78,250
Total liabilities and equity
$
518,000
$
445,000
$
372,500
The company’s income statements for the years ended December 31, 2012 and 2011, follow. Assume that all sales are on credit:
For Year Ended December 31
2012
2011
Sales
$
672,500
$
530,000
Cost of goods sold
$
410,225
$
344,500
Other operating expenses
208,550
133,980
Interest expense
11,100
12,300
Income taxes
8,525
7,845
Total costs and expenses
638,400
498,625
Net income
$
34,100
$
31,375
Earnings per share
$
2.10
$
1.93
Section Break
Exercise 13-9 Liquidity analysis and interpretation L.O. P3
3.
Exercise 13-9 Part 1
(1)
Compute days’ sales uncollected. (Use 365 days a year. Do not round intermediate calculations and roundyour final answers to the nearest whole number.)
4.
Exercise 13-9 Part 2
(2)
Compute accounts receivable turnover. (Round your answers to 1 decimal place.)
2012
2011
5.
Exercise 13-9 Part 3
(3)
Compute inventory turnover. (Round your answers to 1 decimal place.)
6.
Exercise 13-9 Part 4
(4)
Compute days’ sales in inventory. (Use 365 days a year. Do not round intermediate calculations and round your final answers to the nearest whole number.)
2012
2011
Problem 13-1A Ratios, common-size statements, and trend percents L.O. P1, P2, P3
[The following information applies to the questions displayed below.]
Selected comparative financial statements of Bennington Company follow:
BENNINGTON COMPANY
Comparative Income Statements
For Years Ended December 31, 2012, 2011, and 2010
2012
2011
2010
Sales
$
444,000
$
340,000
$
236,000
Cost of goods sold
267,288
212,500
151,040
Gross profit
176,712
127,500
84,960
Selling expenses
62,694
46,920
31,152
Administrative expenses
40,137
29,920
19,470
Total expenses
102,831
76,840
50,622
Income before taxes
73,881
50,660
34,338
Income taxes
13,764
10,370
6,962
Net income
$
60,117
$
40,290
$
27,376
BENNINGTON COMPANY
Comparative Balance Sheets
December 31, 2012, 2011, and 2010
2012
2011
2010
Assets
Current assets
$
48,480
$
37,924
$
50,648
Long-term investments
0
500
3,720
Plant assets, net
90,000
96,000
57,000
Total assets
$
138,480
$
134,424
$
111,368
Liabilities and Equity
Current liabilities
$
20,200
$
19,960
$
19,480
Common stock
72,000
72,000
54,000
Other paid-in capital
9,000
9,000
6,000
Retained earnings
37,280
33,464
31,888
Total liabilities and equity
$
138,480
$
134,424
$
111,368
7.
Problem 13-1A Part 1
Required:
1.
Compute each year’s current ratio. (Round your answers to 1 decimal place.)
Current ratio
December 31, 2012:
Current ratio
December 31, 2011:
Current ratio
December 31, 2010:
8.
Problem 13-1A Part 2
2.
Express the income statement data in common-size percents. (Round your answers to 2 decimal places. Omit the “%” sign in your response.)
9.
Problem 13-1A Part 3
3.
Express the balance sheet data in trend percents with 2010 as the base year. (Round your answers to 2 decimal places. Leave no cells blank – be certain to enter “0” wherever required. Omit the “%” sign in your response.)
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