ACC 421 Week 4 Wiley Plus Exercise 23-4 23-7 23-11 23-12

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The income statement of Rodriquez Company is shown below.
RODRIQUEZ COMPANY
INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 2012
Sales                                                                                      $6,884,420
Cost of goods sold
Beginning inventory                        $1,897,410
Purchases                                            4,478,260
Goods available for sale                   6,375,670
Ending inventory                               1,601,260
Cost of goods sold                                                                    4,774,410
Gross profit                                                                         $      2,110,010
Operating expenses
Selling expenses                                     448,740
Administrative expenses                      695,660            $      1,144,400
Net income                                                                          $          965,610

Additional information:
1. Accounts receivable decreased $317,330 during the year. –
2. Prepaid expenses increased $160,690 during the year.
3. Accounts payable to suppliers of merchandise decreased $281,450 during the year.
4. Accrued expenses payable decreased $127,540 during the year. –
5. Administrative expenses include depreciation expense of $56,710.

Prepare the operating activities section of the statement of cash flows using the direct method.-

Exercise 23-7
Presented below are two independent situations.

Situation A:
Chenowith Co. reports revenues of $191,900 and operating expenses of $111,340 in its first year of operations, 2012. Accounts receivable and accounts payable at year-end were $82,360 and $37,200, respectively. Assume that the accounts payable related to operating expenses. Ignore income taxes.
Using the direct method, compute net cash provided (used) by operating activities. (If an amount reduces the account balance then enter with negative sign.)

Situation B:
The income statement for Edgebrook Company shows cost of goods sold $310,820 and operating expenses (exclusive of depreciation) $227,710. The comparative balance sheet for the year shows that inventory increased $23,390, prepaid expenses decreased $8,240, accounts payable (related to merchandise) decreased $18,620, and accrued expenses payable increased $11,740.
Compute (a) cash payments to suppliers and (b) cash payments for operating expenses.

Exercise 23-11
Condensed financial data of Fairchild Company for 2012 and 2011 are presented below.

                                                      FAIRCHILD COMPANY
COMPARATIVE BALANCE SHEET
AS OF DECEMBER 31, 2012 AND 2011

2012                         2011
Cash                                                                          $1,807                    $1,095              $      (712)
Receivables                                                                1,750                      1,294              $      (456)
Inventory                                                                    1,593                      1,902              $        309
Plant assets                                                                1,897                      1,703              $      (194)
Accumulated depreciation                                    (1,203                     (1,169)                         34
Long-term investments (held-to-maturity)          1,301                      1,465              $        164
 $ 7,145                    $6,290

Accounts payable                                                       $1,216                    $791               $        425
Accrued liabilities                                                             200                      230               $        (30)
Bonds payable                                                               1,406                   1,649               $      (243)
Common stock                                                               1,900                   1,692              $        208
Retained earnings                                                         2,423                    1,928              $        495
$7,145                 $ 6,290

FAIRCHILD COMPANY
INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 2012
Sales                                                                   $6,812
Cost of goods sold                                             4,692
Gross margin                                                    $2,120
Selling and administrative expenses                 920
Income from operations                                $1,200
Other revenues and gains
Gain on sale of investments                            $90
Income before tax                                          $1,290
Income tax expense                                           $531
Net income                                                          $759

Additional information:
During the year, $64 of common stock was issued in exchange for plant assets. No plant assets were sold in 2012. Cash dividends were $264.
Prepare a statement of cash flows using the indirect method. (If an amount reduces the account balance then enter with negative sign.)

Condensed financial data of Fairchild Company for 2012 and 2011 are presented below.

Exercise 23-12
Condensed financial data of Fairchild Company for 2012 and 2011 are presented below.
FAIRCHILD COMPANY
COMPARATIVE BALANCE SHEET
AS OF DECEMBER 31, 2012 AND 2011
2012             2011
Cash                                                                                 $1,805           $1,096        $      (709)
Receivables                                                                       1,742             1,299        $      (443)
Inventory                                                                           1,585             1,905       $        320
Plant assets                                                                       1,894             1,700        $      (194)
Accumulated depreciation                                    $     (1,206)   $     (1,178)-)    $          28
Long-term investments (held-to-maturity)                 1,294              1,469       $        175
$      7,114    $        6,291

Accounts payable                                                          $1,209                $793       $        416
Accrued liabilities                                                               210                  236        $        (26)
Bonds payable                                                                 1,401               1,648        $      (247)
Common stock                                                                 1,891              1,703        $        188
Retained earnings                                                           2,403               1,911        $        492
$        7,114     $        6,291        $        823

FAIRCHILD COMPANY
INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 2012
Sales                                                                     $6,854
Cost of goods sold                                                4,702
Gross margin                                              $        2,152
Selling and administrative expenses                   939
Income from operations-                         $        1,213
Other revenues and gains –
Gain on sale of investments-               $              83
Income before tax-                                   $        1,296
Income tax expense-                                $           534
Net income-                                                $           762

Additional information:
During the year, $73 of common stock was issued in exchange for plant assets. No plant assets were sold in 2012. Cash dividends were $270.

Prepare a statement of cash flows using the direct method. (If an amount reduces the account balance then enter with negative sign.)