accounting

Given the following information for the '09 year, prepare an Income Statement:

* Annual Volume of 8MM units

* Sales Price of $.75 per unit

* Gross Profit Percentage of 10%

* Sales & General Expense were 8% of Sales

* Accumulated Depreciation in '08 totaled 600M; in the

09 year the Total Accumulated Depreciation amount was 650M.

* Bank debt averaged 250M for the year; interest rate was 8%

* EPS was .10

* Tax rate is 40%

* There are 100M shares of common stock outstanding

2)

Given the following , please calculate the Retained Earnings Balance as of 12/31/10:

*

Retained Earnings as of 12/31/07 of $25M

*

Dividends in '08 of $175M

*

Loss in '10 of $50M

*

Income in '09 of $100M

*

Dividends in '09 of $75M

*

Income in '08 of $140M

*

Dividends in '10 of $65M

3)

Given the following Balance Sheet & Income Statement , prepare a Cash Flow Statement

for the year '09.

ABC Company

Income Statement

For the years ended December 31 , 2008 & December 31,2009

12/31/2008

12/31/2009

Sales

2,000,000

2,400,000

COGS

1,700,000

2,088,000

Gross Profit

300,000

312,000

S & G Exp

180,000

240,000

Depreciation

50,000

75,000

EBIT

70,000

(3,000)

Interest

20,000

35,000

EBT

50,000

(38,000)

Taxes

30,000

(22,800)

EAT

20,000

(15,200)

Preferred stock Dividend

20,000

20,000

Common stock Dividend

25,000

15,000

ABC Company

Balance Sheet

12/31/2008

12/31/2009

Current Assets:

Cash

75,200

5,000

Marketable Securities

25,000

35,000

A/R

150,000

225,000

Inventory

175,000

150,000

Prepaid Expenses

75,000

75,000

Total Current Assets

500,200

490,000

Investments

150,000

175,000

Plant & Equipment

325,000

375,000

less Accumulated Depreciation

125,000

200,000

Net Plant & Equipment

200,000

175,000

Total Assets

850,200

840,000

Current Liabilities

A/P

200,000

190,000

Notes Payable

175,000

225,000

Accrued Expenses

50,000

50,000

Total Current Liabilities

425,000

465,000

Bonds Payable

25,000

25,000

Total Liabilities

450,000

490,000

Stockholders Equity

Preferred Stock

15,200

15,200

Common Stock

70,000

70,000

Capital in excess of Par

100,000

100,000

Retained Earnings

215,000

164,800

Total Stockholders Equity

400,200

350,000

Total Liabilties & Stockholders Equity

850,200

840,000

4)

What is a company's primary goal. Explain fully

5)

Given the following , please calculate the Retained Earnings Balance as of 12/31/07:

*

Retained Earnings as of 12/31/10 of $450M

*

Dividends in '10 of $175M

*

Income in '08 of $50M

*

Income in '09 of $100M

*

Dividends in '09 of $75M

*

Loss in '10 of $250M

*

Dividends in '08 of $25M

6)

Based on the following transactions , compile an Income Statement for the year ended 12/31/00.

and calculate the retained earnings as of 12/31/00

*

Retained earnings on 12/31/99 were $150M

*

Corporation , in year 1995, purchased equipment for $150M. This equipment will be

depreciated via 5 year MACRS.

*

Company was unable to collect Accounts Receivable totaling $72M. They have

elected to treat this as a bad debt expense in 2000.

*

Company borrowed money from First bank on 3/31/00. The loan totaled $900M.

The interest rate was fixed at 8%.

*

Land purchased in 1975 for $200M is now valued at $350M; will be sold in 2001.

*

Company has no preferred stock. The Company did elect to pay a dividend of $200M to

common shareholders. There are 100M shares of common stock outstanding.

*

One of the owners borrowed $100M from the business on 9/30/00. Terms are 5 years,

with no interest to be paid in years 1 or 2. Interest rate in years 3-5 is 10%.

*

Selling & General Admin together totaled 5.75% of Sales

*

Volume , for the year , totaled 12MM gallons. Sales Price was $1.05 per gallon

*

Another owner borrowed $150M from the business on 6/30/00. Terms are 5 years,

with interest only to be paid in years 1 and 2. Interest rate is 10%.

*

Company's Gross Profit % was 7% in year 2000.

*

Company is in the 35% tax bracket

*

Corporation , in year 1996, purchased equipment for $350M. This equipment is

depreciated via 10 year MACRS.

7)

Based on the attached information , prepare a cash flow statement for the year ended 12/31/09

ABC Company

Balance Sheet

12/31/2008

12/31/2009

Current Assets:

Cash

325,000

85,000

Marketable Securities

15,000

35,000

A/R

225,000

475,000

Inventory

250,000

150,000

Prepaid Expenses

75,000

75,000

Total Current Assets

890,000

820,000

Investments

150,000

175,000

Plant & Equipment

675,000

945,000

less Accumulated Depreciation

285,000

325,000

Net Plant & Equipment

390,000

620,000

Total Assets

1,430,000

1,615,000

Current Liabilities

A/P

450,000

325,000

Notes Payable

175,000

325,000

Accrued Expenses

50,000

50,000

Total Current Liabilities

675,000

700,000

Bonds Payable

125,000

275,000

Total Liabilities

800,000

975,000

Stockholders Equity

Preferred Stock

30,000

100,000

Common Stock

75,000

140,000

Capital in excess of Par

110,000

150,000

Retained Earnings

415,000

250,000

Total Stockholders Equity

630,000

640,000

Total Liabilties & Stockholders Equity

1,430,000

1,615,000

Other Information:

Net Income before tax

150,000

(225,000)

Net Income after tax

90,000

(135,000)

8)

Based on the following information , prepare a Balance Sheet for the year ended 12/31/08

Net Income

(75,000)

Depreciation

125,000

Change in W/C

Change in Marketable Securities

0

Change in A/R

(100,000)

Change in Inventory

150,000

Change in Prepaid

(75,000)

Change in A/P

250,000

Change in Accrued

0

225,000

Net change from Operations

275,000

Change in Investments

0

Change in PP&E

(250,000)

Net change from Investments

(250,000)

Changs in Bonds Payable

150,000

Change in Notes Payable

(50,000)

Issued Preferred Stock

25,000

Issued Common Stock

50,000

Capital in excess of Par

0

Dividend

(75,000)

Net change from Financing

100,000

Net Change - Cash

125,000

ABC Company

Balance Sheet

12/31/2008

12/31/2009

Current Assets:

Cash

285,000

Marketable Securities

35,000

A/R

475,000

Inventory

150,000

Prepaid Expenses

75,000

Total Current Assets

1,020,000

Investments

175,000

Plant & Equipment

945,000

less Accumulated Depreciation

325,000

Net Plant & Equipment

620,000

Total Assets

1,815,000

Current Liabilities

A/P

325,000

Notes Payable

325,000

Accrued Expenses

50,000

Total Current Liabilities

700,000

Bonds Payable

475,000

Total Liabilities

1,175,000

Stockholders Equity

Preferred Stock

100,000

Common Stock

140,000

Capital in excess of Par

150,000

Retained Earnings

250,000

Total Stockholders Equity

640,000

Total Liabilties & Stockholders Equity

1,815,000

9)

Given the following statements , prepare a cash flow statement & complete the Balance Sheet

as of 12/31/98

*

Income after tax for the year ended 12/31/99 was $100M ; although the

company elected to retain only $70M of this amount

*

Company purchased $250M in depreciable assets during the '99 year

*

The accumulated depreciation amount will change by $75M ('99 vs. '98)

*

Company issued $150M in bonds during the '99 year

*

Company issued $130M in Common stock during the '99 year

*

Company paid down $50M on Notes Payable during the '99 year

*

Company owes $125M more to their vendors in '99 than in '98

*

The Company has $250M more money owed to them in'99 than in '98

*

The Company has a $150M less in inventory in '99 than in '98

*

The Company elected to prepay an additional $50M in rent ( '99 vs. '98)

ABC Company

Balance Sheet

12/31/98

12/31/99

Current Assets:

Cash

285,000

Marketable Securities

35,000

A/R

475,000

Inventory

150,000

Prepaid Expenses

75,000

Total Current Assets

1,020,000

Investments

175,000

Plant & Equipment

945,000

less Accumulated Depreciation

325,000

Net Plant & Equipment

620,000

Total Assets

1,815,000

Current Liabilities

A/P

325,000

Notes Payable

325,000

Accrued Expenses

50,000

Total Current Liabilities

700,000

Bonds Payable

475,000

Total Liabilities

1,175,000

Stockholders Equity

Preferred Stock

100,000

Common Stock

140,000

Capital in excess of Par

150,000

Retained Earnings

250,000

Total Stockholders Equity

640,000

Total Liabilties & Stockholders Equity

1,815,000