In: Economics
In: Accounting
1. Please explain revenue recognition abuse with examples.
2. What is MD&A in accounting?
In: Accounting
Explain the revenue and expense recognition principles with an example. Within this respect, explain also why unearned revenues cannot be revenues but liabilities.
In: Accounting
why does a hub and spoke networks make the revenue management process more complicated ?
In: Economics
Revenue and expense data for Searle Technologies Co. are as follows:
|
The following comparative income statement (in thousands of dollars) for two recent years was adapted from the annual report of Speedway Motorsports, Inc. (TRK), owner and operator of several major motor speedways, such as the Atlanta, Bristol, Charlotte, Texas, and Las Vegas Motor Speedways.
Note: "General & administrative expenses for the year 1 includes impairment of goodwill of $89,037. a. Prepare a comparative income statement for
Years 1 and 2 in vertical form, stating each item as a percent of
revenues.
b. What conclusion can be drawn from the
analysis regarding the change in income? |
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a. Prepare an income statement in comparative form, stating each item for both 20Y8 and 20Y7 as a percent of sales. Round to one decimal place.
| Searle Technologies Co. | ||||
| Comparative Income Statement | ||||
| For the Years Ended December 31, 20Y8 and 20Y7 | ||||
| 20Y8 Amount | 20Y8 Percent | 20Y7 Amount | 20Y7 Percent | |
| $ | % | $ | % | |
| % | % | |||
| Gross profit | $ | % | $ | % |
| $ | % | $ | % | |
| % | % | |||
| Total operating expenses | $ | % | $ | % |
| $ | % | $ | % | |
| % | % | |||
| Net income | $ | % | $ | % |
b. All of the following are true regarding the vertical analysis for Searle except:
In: Accounting
The Internal Revenue Code allows a corporation to carry back or carry forward an “operating loss” for a given year.
In: Accounting
Revenue and expense data for Innovation Quarter Inc. for two recent years are as follows:
| Current Year | Previous Year | |||
| Sales | $488,000 | $410,000 | ||
| Cost of goods sold | 287,920 | 217,300 | ||
| Selling expenses | 78,080 | 77,900 | ||
| Administrative expenses | 87,840 | 69,700 | ||
| Income tax expense | 14,640 | 16,400 | ||
a. Prepare an income statement in comparative form, stating each item for both years as a percent of sales. If required, round percentages to one decimal place. Enter all amounts as positive numbers.
| Innovation Quarter Inc. | ||||
| Comparative Income Statement | ||||
| For the Years Ended December 31 | ||||
| Current year Amount | Current year Percent | Previous year Amount | Previous year Percent | |
| Sales | $488,000 | % | $410,000 | % |
| Cost of goods sold | 287,920 | % | 217,300 | % |
| Gross profit | $ | % | $ | % |
| Selling expenses | 78,080 | % | 77,900 | % |
| Administrative expenses | 87,840 | % | 69,700 | % |
| Total operating expenses | $ | % | $ | % |
| Income from operations | % | % | ||
| Income tax expense | 14,640 | % | 16,400 | % |
| Net income | $ | % | $ | % |
b. The vertical analysis indicates that the cost of goods sold as a percent of sales by 6 percentage points, while selling expenses by 3 percentage points, and administrative expenses by 1 percentage points. Thus, net income as a percent of sales by 3 percentage points.
In: Accounting
2. Project A will cost $100,000 and requires working capital of $20,000. Annual revenue of $21,000 and expenses of $5,000 for five years. In the fifth year there will be salvage value of $8,000.
Should the project be accepted with a discounted rate of 14%. Annuity rate 2.91371; Single factor rate .51937.
In: Accounting
2. Project A will cost $100,000 and requires working capital of $20,000. Annual revenue of $21,000 and expenses of $5,000 for five years. In the fifth year, there will be a salvage value of $8,000. Should the project be accepted with a discounted rate of 14%? Annuity rate 2.91371; Single-factor rate .51937.
In: Accounting