Vertical Analysis of Income Statement

Revenue and expense data for Innovation Quarter Inc. for two recent years are as follows:

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.

b. The vertical analysis indicates that the cost of goods sold as a percent of sales   by 5 percentage points, while selling expenses   by 2 percentage points, and administrative expenses   by 1 percentage points. Thus, net income as a percent of sales   by 2 percentage points.

1. Define what an "Intergovernmental Revenue" is. Provide at least 2 examples.

2. Assume a local government has determined they will increase taxes in order to raise revenue to support their capital improvements plan. Contrast and compare the merits of increasing property taxes versus sales taxes. Consider the various forces which effect public budgeting in your response.

Using FASB, research revenue recognition rules and procedures. Discuss a current rule that is either recently changed or under review to change. Compare and contrast it with the current or old rule. Provide examples when considering the impact.

a. Consider this statement: "Quickbooks Accountant records revenue when an invoice is generated even though cash has not been received." Is this practice acceptable? Why or why not?

b. When you've finished reconciling a bank account, what should be the difference between the ending balance and the cleared balance?

c. What information is included in the Reconciliation Summary report?

d. Explain the typical relationship between sales and cost of goods sold, and describe how this information is included in the QuickBooks Accountant budgeting process

discuss. #4

The following represents the financial information for Domingo Corporation for two months.

Required:

Construct a cost of quality report for March and April. (Input all amounts as positive values. Round percentage answers to 1 decimal place (i.e., 32.1).)

a. A $400,000 investment in a surface mount placement machine produces pre-tax revenue of $77640/yr for 10 years, at which time the SMP machine has a salvage value of $100,000. Based on a 25% income tax rate, a 12% after tax MARR, & SLN depreciation, what will be the ATPW (After Tax Present Worth) of the investment?  
b. Brian a Temple graduate suggests using a 6% bond issue to pay for the investment from the previous example. What will the ATPW be? $  (remember that a bond pays interest only each year and is repaid in full at the end of the term.

Tell why governments use special revenue, permanent, capital projects, and debt service funds.

Consider that 2018 was Rail Company's first year of operations. Rail reported $665,000 of total revenue for the twelve months ended 12/31/2018, and reported the following normal account balances as of 12/31/2018:

1 Accounts Payable $4,000 10 Note Payable $68,950

2 Accounts Receivable 50,000 11 Office Supplies 2,300

3 Accumulated Depreciation 84,070 12 Prepaid Advertising Expense 5,000

4 Cash 23,950 13 Prepaid Insurance Expense 3,300

5 Common Stock 172,500 14 Rent Payable 3,200

6 Dividends 50,000 15 Salaries Payable 5,200

7 Dividends Payable 5,500 16 Shop Supplies 5,800

8 Equipment 267,200 17 Utilities Payable 1,630

9 Land 35,000

Consider the above information and determine the amount of total expense incurred by Rail Company for the year ended 12/31/2018.

A suburban hotel derives its revenue from its hotel and restaurant operations. The owners are interested in the relationship between the number of rooms occupied on a nightly basis and the revenue per day in the restaurant. Below is a sample of 25 days (Monday through Thursday) from last year showing the restaurant income and number of rooms occupied.

a. Choose the scatter diagram that best fits the data.

b. Determine the coefficient of correlation between the two variables. (Round your answer to 3 decimal places.)

1. c-1. State the decision rule for 0.01 significance level: H₀: ρ ≤ 0; H₁: ρ > 0. (Round your answer to 3 decimal places.)

1. c-2. Compute the value of the test statistic. (Round your answer to 2 decimal places.)

1. c-3. Is it reasonable to conclude that there is a positive relationship between revenue and occupied rooms? Use the 0.01 significance level.

d.

4. What percent of the variation in revenue in the restaurant is accounted for by the number of rooms occupied? (Round your answer to 1 decimal place.)