Instructions: Only enter data in the yellow boxes. The remaining areas are already completed for you.
Save the file as follows: lastnamewk1.docx
Submit to the assignment box before the due date.(Late assignments will receive a late penalty).
Grading Rubric:There are a total of 68 “questions” for you to answer (as determined by the yellow box). Each item is worth 0.06 points for a total of 4.00 points.
|
P1-3B, Prepare an income statement, retained earnings statement, and balance sheet; discuss results.
|
|||
|
Instructions:
|
|||
|
(a)Prepare an income statement and a retained earnings statement for the month of May and a balance sheet at May 31, 2014.
|
|||
|
SHAW’S GARDEN
|
|||
|
Income Statement
|
|||
|
For the Month Ended May 31, 2014
|
|||
|
Revenues
|
|||
|
Account title
|
Amount
|
||
|
Expenses
|
|||
|
Account title
|
Amount
|
||
|
Account title
|
Amount
|
||
|
Account title
|
Amount
|
||
|
Account title
|
Amount
|
||
|
Total expenses
|
Amount
|
||
|
Net income
|
Amount
|
||
|
SHAW’S GARDEN
|
|||
|
Retained Earnings Statement
|
|||
|
For the Month Ended May 31, 2014
|
|||
|
Retained earnings, May 1
|
Amount
|
||
|
Add:
|
Account title
|
Amount
|
|
|
Amount
|
|||
|
Less:
|
Account title
|
Amount
|
|
|
Retained earnings, May 31
|
Amount
|
||
P1-3B Shaw’s Garden was started on May 1 with an investment of $45,000 cash. Following
are the assets, liabilities, and common stock of the company on May 31, 2014, and the
revenues and expenses for the month of May, its first month of operations.
Accounts receivable $ 8,400 Notes payable $26,000
Service revenue 10,400 Salaries and wages expense 1,900
Advertising expense 1,800 Equipment 58,800
Accounts payable 4,400 Maintenance and repairs expense 2,100
Cash 10,800 Insurance expense 400
Common stock 45,000
No additional common stock was issued in May, but a dividend of $1,600 in cash was
paid.
Instructions
(a) Prepare an income statement and a retained earnings statement for the month of May
and a balance sheet at May 31, 2014.
(b) Briefly discuss whether the company’s first month of operations was a success.
(c) Discuss the company’s decision to distribute a dividend.
P1-3B Shaw’s Garden was started on May 1 with an investment of $45,000 cash. Following
are the assets, liabilities, and common stock of the company on May 31, 2014, and the
revenues and expenses for the month of May, its first month of operations.
Accounts receivable $ 8,400 Notes payable $26,000
Service revenue 10,400 Salaries and wages expense 1,900
Advertising expense 1,800 Equipment 58,800
Accounts payable 4,400 Maintenance and repairs expense 2,100
Cash 10,800 Insurance expense 400
Common stock 45,000
No additional common stock was issued in May, but a dividend of $1,600 in cash was
paid.
Instructions
(a) Prepare an income statement and a retained earnings statement for the month of May
and a balance sheet at May 31, 2014.
(b) Briefly discuss whether the company’s first month of operations was a success.
(c) Discuss the company’s decision to distribute a dividend.
Prepare an income statement,
retained earnings statement,
and balance sheet; discuss
results.
(LO 4, 5), AP
|
SHAW’S GARDEN
|
||||
|
Balance Sheet
|
||||
|
May 31, 2014
|
||||
|
Assets
|
||||
|
Account title
|
Amount
|
|||
|
Account title
|
Amount
|
|||
|
Account title
|
Amount
|
|||
|
Total assets
|
Amount
|
|||
|
Liabilities and Stockholders’ Equity
|
||||
|
Liabilities
|
||||
|
Account title
|
Amount
|
|||
|
Account title
|
Amount
|
|||
|
Total liabilities
|
Amount
|
|||
|
Stockholders’ equity
|
||||
|
Account title
|
Amount
|
|||
|
Account title
|
Amount
|
|||
|
Total stockholders’ equity
|
Amount
|
|||
|
Total liabilities and stockholders’ equity
|
Amount
|
|||
|
(b) Briefly discuss whether the company’s first month of operations was a success.
|
||||
|
Enter text answer here.
|
||||
|
(c) Discuss the company’s decision to distribute a dividend.
|
||||
|
Enter text answer here.
|
||||
|
P1-4B, Determine items to be included in a statement of cash flows, prepare a cash flow statement and discuss the results.
|
||
|
Instructions:
|
||
|
(a)Determine which items should be included in a statement of cash flows and then prepare the statement for Preacher Corporation.
|
||
|
Enter text answer here.
|
||
|
PREACHER CORPORATION
|
|||
|
Statement of Cash Flows
|
|||
|
For the Year Ended December 31, 2014
|
|||
|
Cash flows from operating activities
|
|||
|
Activity
|
Amount
|
||
|
Activity
|
Amount
|
||
|
Net cash provided by operating activities
|
Amount
|
||
|
Cash flows from investing activities
|
|||
|
Activity
|
Amount
|
||
|
Activity
|
Amount
|
||
|
Net cash used by investing activities
|
Amount
|
||
|
Cash flows from financing activities
|
|||
|
Activity
|
Amount
|
||
|
Activity
|
Amount
|
||
|
Net cash provided by financing activities
|
Amount
|
||
|
Net increase in cash
|
Amount
|
||
|
(b) Comment on the adequacy of net cash provided by operating activities to fund the company’s investing activities and dividend payments.
|
|||
|
Enter text answer here.
|
|||
(Continued)
|
P2-7B, Compute values and ratios for the following; discuss results.
|
||||
|
Instructions:
|
||||
|
(a)For each company, compute these values and ratios:
be sure to show your computations! |
||||
|
Home Depot
|
Lowe’s
|
|||
|
Working Capital
|
Amount
|
Amount
|
||
|
Current ratio (round to two decimal places)
|
Amount
|
Amount
|
||
|
Debt to total assets ratio
|
Amount
|
Amount
|
||
|
Free cash flow
|
Amount
|
Amount
|
||
|
Earnings per share
|
Amount
|
Amount
|
||
|
(b) Compare the liquidity, profitability and solvency of the two companies.
|
||||
|
Enter text answer here.
|
||||
