Homework 2
1. Prepare a multistep income statement for YYY for the year ending December 31, 2013 given the information below:
Interest expense 17090
Beginning inventory 63210
Depreciation expense 12510
Management salaries 17950
Advertising expenditures 12930
Ending inventory 68390
Gross sales 462720
Taxes 3720
Returns and allowances 10210
Lease payments 39270
Materials purchases 228580
R&D expenditures 4890
Repairs and maintenance costs 2910
What are YYY:
a) gross profit?
b) net Profit?
c) EBT ?
d) Net income?
2. Using the following accounts from Income statement for the year Ending December 31, 2012, answer the following questions:
Research and Development expenditures 50
Cost of Goods Sold 600
Lease payments 30
Advertising 20
Taxes 35
Repairs and maintenance expenses 40
Management salaries 100
Interest expense 30
Net Sales 1000
Depreciation 60
What was:
a) Gross profit?
b) Operating Profit
c) Net profit?
3. In 2009, the FFF purchased 180,000 units from its supplier at a cost of 42.50 per unit. FFF sold 192,000 units in 2009 at a price of 58.75. FFF began 2009 with 1,360,000 in inventory (inventory is carried at a cost of 42.50 per unit). Using this info, compute FFF gross profit for 2009 and compute 2009 ending inventory balance.
4. Consider the equity portion of the TTT balance sheet for December 31, 2012 and 2013
EQUITY SECTION OF Balance Sheet
December 31, 2012 and 2013
(in thousands)
2012 2013
Common stock ( $2 par) 1100 1250
Capital surplus 7600 9200
Retained earnings 2400 3200
Company reported net income for 2002 of 1100 and net income for 2003 of 1500. Answer the following questions:
a) How many new shares of stock did TTT issue in 2003?
b) Assume all the new stocks was issued at the same time, at what price per share did the new stock sell?
c) What was TT dividend per share payout
Interest expense 17090
Beginning inventory 63210
Depreciation expense 12510
Management salaries 17950
Advertising expenditures 12930
Ending inventory 68390
Gross sales 462720
Taxes 3720
Returns and allowances 10210
Lease payments 39270
Materials purchases 228580
R&D expenditures 4890
Repairs and maintenance costs 2910
What are YYY:
a) gross profit?
b) net Profit?
c) EBT ?
d) Net income?
2. Using the following accounts from Income statement for the year Ending December 31, 2012, answer the following questions:
Research and Development expenditures 50
Cost of Goods Sold 600
Lease payments 30
Advertising 20
Taxes 35
Repairs and maintenance expenses 40
Management salaries 100
Interest expense 30
Net Sales 1000
Depreciation 60
What was:
a) Gross profit?
b) Operating Profit
c) Net profit?
3. In 2009, the FFF purchased 180,000 units from its supplier at a cost of 42.50 per unit. FFF sold 192,000 units in 2009 at a price of 58.75. FFF began 2009 with 1,360,000 in inventory (inventory is carried at a cost of 42.50 per unit). Using this info, compute FFF gross profit for 2009 and compute 2009 ending inventory balance.
4. Consider the equity portion of the TTT balance sheet for December 31, 2012 and 2013
EQUITY SECTION OF Balance Sheet
December 31, 2012 and 2013
(in thousands)
2012 2013
Common stock ( $2 par) 1100 1250
Capital surplus 7600 9200
Retained earnings 2400 3200
Company reported net income for 2002 of 1100 and net income for 2003 of 1500. Answer the following questions:
a) How many new shares of stock did TTT issue in 2003?
b) Assume all the new stocks was issued at the same time, at what price per share did the new stock sell?
c) What was TT dividend per share payout