Royal Corp’s financial information (in millions, except
for Dividends) for Problems 2 and 3:
2019 2018
Accounts
Payable $ 7,000 $ 6,780
Accounts Receivable 5,000 4,685
Additional Paid-in Capital 4,000 4,000
Cash 8,577 5,654
Common Stock 3,107 3,107
Cost of Goods Sold 48,464 47,594
Depreciation 1,315 1,244
Dividends per share 1.53 1.28
Goodwill 18,051 19,121
Interest Expense 1,200 1,100
Inventory 8,871 8,101
Long-Term Debt ? ?
Net Property, Plant & Equipment 26,500 25,311
Notes Payable 4,200 3,770
Research & Development Expense 1,847 1,747
Retained Earnings ? 23,045
Revenue 61,200 59,000
Selling General & Admin Expense 3,200 3,024
Shares Outstanding 1,170 1,280
Treasury Stock (6,500) (4,200)
Tax Rate = 30%
Note that a reduction in Goodwill would be similar to Depreciation Expense in a firm’s Operating Cash Flow.
2. See the last page for the financial information of Royal Corporation.
2 A. Construct Income Statements for 2018 and 2019
2019 2018
2B. Construct Balance Sheets for 2018 and 2019
Assets Liabilities
and Owners’ Equity
2019 2018 2019 2018
2C. Construct a 2019 Statement of Cash Flows (Goodwill reduction is
a noncash expense)
In: Accounting
The following is the receipts and payments account for the year ended 31 December 2018:
| Receipts: | Payments: | |||
| Balance b/f | 2040 | Bar Purchases | 88680 | |
| Entrance fees | 840 | Rent | 8320 | |
| Subscriptions: 2017 | 500 | Wages | 3720 | |
| 2018 | 6100 | Printing expenses | 2560 | |
| 2019 | 700 | General expenses | 1940 | |
| Bar Sales | 104540 | New Equipment | 9000 | |
| Sales of investments | 15000 | Balance c/f | 15500 | |
| 129720 | 129720 |
| (1)Additional information: | 01-Jan-18 | 31-Dec-18 |
| Bar inventory | 5440 | 6300 |
| Owing for bar purchases | 6120 | 7160 |
| Rent due | 360 | 720 |
| Heating and lighting due | 320 | 380 |
| Subscription due | 500 | 800 |
| General expenses paid in advance | 100 | 140 |
(2) On 31 December 2017 the club held investments which
cost $10000. During the year ended 31 December 2018, these were
sold for $15000.
(3) Equipment was valued at $6000 on 31 December 2017. On 30 June
2018, the club purchased additional equipment at a cost of $ 10400.
Depreciation is to be provided for at the rate of 10% per
annum.
(a) Prepare the trading section of the income statement
for the year ended 31 December 2018.
(b) Prepare the income and expenditure account for the year ended
31 December 2018.
In: Accounting
In: Accounting
On June 30, 2017, Bramble Company issued $3,300,000 face value of 13%, 20-year bonds at $3,548,257, a yield of 12%. Bramble uses the effective-interest method to amortize bond premium or discount. The bonds pay semiannual interest on June 30 and December 31.
Prepare the journal entries to record the following transactions. (Round answer to 0 decimal places, e.g. 38,548. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)
(1) The issuance of the bonds on June 30, 2017.
(2) The payment of interest and the amortization of the premium on December 31, 2017.
(3) The payment of interest and the amortization of the premium on June 30, 2018.
(4) The payment of interest and the amortization of the premium on December 31, 2018.
(1) June 30, 2017
(2) December 31, 2017
(3) June 30, 2018
(4) December 31, 2018
Show the proper balance sheet presentation for the liability for bonds payable on the December 31, 2018, balance sheet.
Provide the answers to the following questions.
(1) What amount of interest expense is reported for 2018? (Round answer to 0 decimal places, e.g. 38,548.) Interest expense reported for 2018 $
(2) Will the bond interest expense reported in 2018 be the same as, greater than, or less than the amount that would be reported if the straight-line method of amortization were used? The bond interest expense reported in 2018 will be the amount that would be reported if the straight-line method of amortization were used.
(3) Determine the total cost of borrowing over the life of the bond. (Round answer to 0 decimal places, e.g. 38,548.) Total cost of borrowing over the life of the bond $
(4) Will the total bond interest expense for the life of the bond be greater than, the same as, or less than the total interest expense if the straight-line method of amortization were used? The total bond interest expense for the life of the bond will be the total interest expense if the straight-line method of amortization were used.
The total bond interest expense for the life of the bond will be ?
In: Accounting
| KORBIN COMPANY | |||||||||
| Comparative Income Statements | |||||||||
| For Years Ended December 31, 2019, 2018, and 2017 | |||||||||
| 2019 | 2018 | 2017 | |||||||
| Sales | $ | 446,549 | $ | 342,093 | $ | 237,400 | |||
| Cost of goods sold | 268,822 | 213,808 | 151,936 | ||||||
| Gross profit | 177,727 | 128,285 | 85,464 | ||||||
| Selling expenses | 63,410 | 47,209 | 31,337 | ||||||
| Administrative expenses | 40,189 | 30,104 | 19,704 | ||||||
| Total expenses | 103,599 | 77,313 | 51,041 | ||||||
| Income before taxes | 74,128 | 50,972 | 34,423 | ||||||
| Income tax expense | 13,788 | 10,449 | 6,988 | ||||||
| Net income | $ | 60,340 | $ | 40,523 | $ | 27,435 | |||
| KORBIN COMPANY | |||||||||
| Comparative Balance Sheets | |||||||||
| December 31, 2019, 2018, and 2017 | |||||||||
| 2019 | 2018 | 2017 | |||||||
| Assets | |||||||||
| Current assets | $ | 59,723 | $ | 39,972 | $ | 53,434 | |||
| Long-term investments | 0 | 600 | 4,610 | ||||||
| Plant assets, net | 110,913 | 101,174 | 59,393 | ||||||
| Total assets | $ | 170,636 | $ | 141,746 | $ | 117,437 | |||
| Liabilities and Equity | |||||||||
| Current liabilities | $ | 24,913 | $ | 21,120 | $ | 20,551 | |||
| Common stock | 70,000 | 70,000 | 52,000 | ||||||
| Other paid-in capital | 8,750 | 8,750 | 5,778 | ||||||
| Retained earnings | 66,973 | 41,876 | 39,108 | ||||||
| Total liabilities and equity | $ | 170,636 | $ | 141,746 | $ | 117,437 | |||
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In: Accounting
The following income statement items appeared on the adjusted trial balance of Schembri Manufacturing Corporation for the year ended December 31, 2018 ($ in 000s): sales revenue, $18,300; cost of goods sold, $7,700; selling expenses, $1,450; general and administrative expenses, $950; interest revenue, $230; interest expense, $320. Income taxes have not yet been recorded. The company’s income tax rate is 20% on all items of income or loss. These revenue and expense items appear in the company’s income statement every year. The company’s controller, however, has asked for your help in determining the appropriate treatment of the following nonrecurring transactions that also occurred during 2018 ($ in 000s). All transactions are material in amount. Investments were sold during the year at a loss of $370. Schembri also had unrealized gains of $470 for the year on investments. One of the company’s factories was closed during the year. Restructuring costs incurred were $1,800. During the year, Schembri completed the sale of one of its operating divisions that qualifies as a component of the entity according to GAAP. The division had incurred a loss from operations of $710 in 2018 prior to the sale, and its assets were sold at a gain of $1,700. In 2018, the company’s accountant discovered that depreciation expense in 2017 for the office building was understated by $350. Negative foreign currency translation adjustment for the year totaled $420. Required: 1. Prepare Schembri’s single, continuous multiple-step statement of comprehensive income for 2018, including earnings per share disclosures. One million shares of common stock were outstanding at the beginning of the year and an additional 200,000 shares were issued on July 1, 2018. 2. Prepare a separate statement of comprehensive income for 2018. Prepare Schembri’s single, continuous multiple-step statement of comprehensive income for 2018, including earnings per share disclosures. One million shares of common stock were outstanding at the beginning of the year and an additional 200,000 shares were issued on July 1, 2018. (Amounts to be deducted should be indicated with a minus sign. Enter your answers in thousands. Round EPS answers to 2 decimal places.)
In: Accounting
Med Student Sleep Average (Raw Data, Software
Required):
Here we consider a small study on the sleep habits of med students
and non-med students. The study consists of the hours of sleep per
night obtained from 30 non-med students and 25 med students. The
sample data is given in the table below. Test the claim that, on
average, the mean hours of sleep for all med students is different
from that for non-med students. Test this claim at the 0.01
significance level.
(a) The claim states there is a difference between population means (μ1 − μ2 ≠ 0). What type of test is this? This is a two-tailed test.This is a right-tailed test. This is a left-tailed test. (b) Use software to calculate the test statistic. Do not 'pool' the variance. This means you do not assume equal variances. Round your answer to 2 decimal places. t = (c) Use software to get the P-value of the test statistic. Round to 4 decimal places. P-value = (d) What is the conclusion regarding the null hypothesis? reject H0fail to reject H0 (e) Choose the appropriate concluding statement. The data supports the claim that, on average, the mean hours of sleep for all med students is different from that for non-med students.There is not enough data to support the claim that, on average, the mean hours of sleep for all med students is different from that for non-med students. We reject the claim that, on average, the mean hours of sleep for all med students is different from that for non-med students.We have proven that, on average, the mean hours of sleep for all med students is different from that for non-med students. |
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In: Statistics and Probability
Med Student Sleep Average (Raw Data, Software
Required):
Here we consider a small study on the sleep habits of med students
and non-med students. The study consists of the hours of sleep per
night obtained from 30 non-med students and 25 med students. The
sample data is given in the table below. Test the claim that, on
average, the mean hours of sleep for all med students is different
from that for non-med students. Test this claim at the 0.01
significance level.
(a) The claim states there is a difference between population means (μ1 − μ2 ≠ 0). What type of test is this? This is a two-tailed test. This is a right-tailed test. This is a left-tailed test. (b) Use software to calculate the test statistic. Do not 'pool' the variance. This means you do not assume equal variances. Round your answer to 2 decimal places. t = (c) Use software to get the P-value of the test statistic. Round to 4 decimal places. P-value = (d) What is the conclusion regarding the null hypothesis? reject H0 fail to reject H0 (e) Choose the appropriate concluding statement. The data supports the claim that, on average, the mean hours of sleep for all med students is different from that for non-med students. There is not enough data to support the claim that, on average, the mean hours of sleep for all med students is different from that for non-med students. We reject the claim that, on average, the mean hours of sleep for all med students is different from that for non-med students. We have proven that, on average, the mean hours of sleep for all med students is different from that for non-med students. |
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In: Statistics and Probability
Med Student Sleep Average (Raw Data, Software
Required):
Here we consider a small study on the sleep habits of med students
and non-med students. The study consists of the hours of sleep per
night obtained from 30 non-med students and 25 med students. The
sample data is given in the table below. Test the claim that, on
average, the mean hours of sleep for all med students is different
from that for non-med students. Test this claim at the 0.05
significance level.
(a) The claim states there is a difference between population means (μ1 − μ2 ≠ 0). What type of test is this? This is a right-tailed test. This is a left-tailed test. This is a two-tailed test. (b) Use software to calculate the test statistic. Do not 'pool' the variance. This means you do not assume equal variances. Round your answer to 2 decimal places. t = (c) Use software to get the P-value of the test statistic. Round to 4 decimal places. P-value = (d) What is the conclusion regarding the null hypothesis? reject H0 fail to reject H0 (e) Choose the appropriate concluding statement. The data supports the claim that, on average, the mean hours of sleep for all med students is different from that for non-med students. There is not enough data to support the claim that, on average, the mean hours of sleep for all med students is different from that for non-med students. We reject the claim that, on average, the mean hours of sleep for all med students is different from that for non-med students. We have proven that, on average, the mean hours of sleep for all med students is different from that for non-med students. |
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In: Statistics and Probability
Create an excel workbook for the following questions. Answer these questions under your Solver work for each respective problem.
1. Devos Inc. is building a hotel. It will have 4 kinds of rooms: suites where customers can smoke, suites that are non-smoking, budget rooms where the customers can smoke, and budget rooms that are non-smoking. When we build the hotel, we need to plan for how many rooms of each type we should have. The following are requirements for the hotel:
Answer the following using your Solver answers:
In: Statistics and Probability