BUS 591 Week 1 Homework Assignment

BUS591 – Financial Statement and Analysis
Week 1 Homework Assignment Templates
Instructions: Only enter data in the yellow boxes. The remaining areas are already completedfor you.

Submit to the assignment box before the due date. (Late assignments will receive a latepenalty).
Grading Rubric: There are a total of 68 “questions” for you to answer (as determined by theyellow box). Each item is worth 0.06 points for a total of 4.00 points.
P1-3B, Prepare an income statement, retained earnings statement, and balance sheet;discuss results.
Instructions:
(a) Prepare an income statement and a retained earnings statement for the month of May anda balance sheet at May 31, 2014.
SHAW’S GARDEN

(b) Briefly discuss whether the company’s first month of operations was a success.Enter text answer here.

(c) Discuss the company’s decision to distribute a dividend.Enter text answer here.

P1-4B, Determine items to be included in a statement of cash flows, prepare a cash flowstatement and discuss the results.
Instructions:
(a) Determine which items should be included in a statement of cash flows and then preparethe statement for Preacher Corporation.

PREACHER CORPORATION
Statement of Cash Flows
For the Year Ended December 31, 2014
Cash flows from operating activities
Activity
Amount
Activity
Amount
Net cash provided by operating activities
Cash flows from investing activities
Activity
Amount
Activity
Amount
Net cash used by investing activities
Cash flows from financing activities
Activity
Amount
Activity
Amount
Net cash provided by financing activities
Net increase in cash
(b) Comment on the adequacy of net cash provided by operating activities to fund thecompany’s investing activities and dividend payments.
Enter text answer here.

(Continued)

Amount

Amount

Amount
Amount

P2-7B, Compute values and ratios for the following; discuss results.
Instructions:
(a) For each company, compute these values and ratios:
be sure to show your computations!
Working Capital
Current ratio (round to
two decimal places)
Debt to total assets ratio
Free cash flow
Earnings per share

(b) Compare the liquidity, profitability and solvency of the two companies.Enter text answer here.