Question: During the first month of its current

> For each of the following costs, check the column(s) that most likely apply: Cost Variable Fixed Raw materials Staples used to secure packed boxes of product Plant janitors' wages Order processing clerks' wages Advertising expenses Production worker

> For each of the following costs, check the column(s) that most likely apply: Cost Variable Fixed Wages of assembly-line workers Depreciation-plant equipment Glue and thread Shipping costs Raw materials handling costs Salary of public relations manag

> High Tech, Inc., and Old Time Co. compete within the same industry and had the following operating results in 2010: Required: a. Calculate the break-even point for each firm in terms of revenue. b. What observations can you draw by examining the break-

> a. Prepare a personal balance sheet for yourself as of today. Work at identifying your assets and liabilities; use rough estimates for amounts. b. Prepare a projected income statement for yourself for the current semester. Work at identifying your revenu

> The concept of financial leverage was introduced in Chapter 7 and expanded on in Chapter 11. In Exercise 7.15 you were asked to describe the risks associated with financial leverage. You should now review the solution provided for this problem at www.mhh

> Tommy Appleton is in charge of arranging the “attitude adjustment” period and dinner for the monthly meetings of the local chapter of the Management Accountants Association. Tommy is negotiating with a new restaurant that would like to have the group’s b

> Assume you are a sales representative for Sweet Tooth Candy Company. One of your customers is interested in buying some candy that will be given to the members of a high school Substance Abuse Awareness Club. The club members will be marching in a commun

> You have recently been engaged by Dominic’s Italian Cafe to evaluate the financial impact of adding gourmet pizza items to the menu. A survey of the clientele indicates that demand for the product exists at an average selling price of $18 per pizza. Fixe

> Canada Printing Group, Inc. (CPGI), has recently begun the process of acquiring small to medium-size local and regional printing firms across the country to facilitate its corporate strategy of becoming the low-cost provider of graphic arts and printing

> This problem is based on the 2008 annual report of Intel Corporation in the appendix. Required: a. Compute the following profitability measures for the year ended December 27, 2008: 1. Return on investment, based on net income (perform a DuPont analysis

> Presented here are summarized data from the balance sheets and income statements of Wiper, Inc.: Required: a. Calculate return on investment, based on net income and average total assets, for 2011 and 2010. Show both margin and turnover in your calcula

> Selected balance sheet accounts for Tibbetts Company on September 30, 2010, are as follows: Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 32,000 Marketable securities. . . . . . . . . . . . . . . . . . . . . . . . .

> Assume that the current ratio for Arch Company is 2.0, its acid-test ratio is 1.5, and its working capital is $300,000. Answer each of the following questions independently, always referring to the original information. a. How much does the firm have in

> Required: Prepare a common size balance sheet at December 27, 2008, using the following captions: Total current assets Property, plant, and equipment (net) Marketable equity securities and other long-term investments Goodwill and other long-term assets T

> Refer to the consolidated balance sheets on page 688 of the Intel Corporation annual report in the appendix. Required: Prepare a common size balance sheet at December 29, 2007, using the following captions: Total current assets Property, plant, and equi

> Selected data from the September 27, 2008, and September 29, 2007, consolidated balance sheets and income statements for the years then ended for Apple Inc. follow. All amounts are reported in millions. Required: a. Calculate the amount of Appleâ

> Listed here are a number of financial statement captions. Indicate in the spaces to the right of each caption the category of each item and the financial statement(s) on which the item can usually be found. Use the following abbreviations: a/

> Look forward to the day when you will have accumulated $5,000, and assume that you have decided to invest that hard-earned money in the common stock of a publicly owned corporation. What data about that company will you be most interested in, and how wil

> Indicate the effect that each transaction/event listed here will have on the financial ratio listed opposite it, and provide an explanation for your answer. Use + for increase, - for decrease, and (NE) for no effect. Assume that current assets exceed cur

> The Office of Management and Budget provides access to the budget of the United States government at its Web site: www.gpoaccess.gov/usbudget/citizensguide.html. “A Citizen’s Guide to the Federal Budget” provides information about the budget and the budg

> Aussie Corp. manufactures rugby jerseys for collegiate sports teams and sells its merchandise through university bookstores. Required: Identify a specific item in the company’s manufacturing, selling, or administrative processes for which the cost would

> Indicate the effect that each transaction/event listed here will have on the financial ratio listed opposite it, and provide an explanation for your answer. Use + for increase, - for decrease, and (NE) for no effect. Assume that current assets exceed cur

> If your library has a common stock investment advisory service such as Moody’s Handbook of Common Stocks or online access to an investment advisory service such as Value Line Research Center: Historical Reports, use one of those sources to locate a repor

> You should also review the solution to Case 4.26 on the Web site for this text at www.mhhe.com/marshall9e before attempting to complete this case.) Case 4.26: Gerrard Construction Co. is an excavation contractor. The following summarized data (in thous

> Partially completed financial statements for Whittaker, Inc., follow: WHITTAKER, INC. Income Statement For the Year Ended December 31, 2011 Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

> The annual reports of the Coca-Cola Co. and PepsiCo, Inc., indicate the following for the year ended December 31, 2008 (amounts in millions): Required: a. Calculate ROI and ROE for each company for 2008. (Hint: You will need to calculate some of the nu

> This problem is based on the 2008 annual report of Intel Corporation in the appendix. Find in the Selected Financial Data (also known as the Five-Year Financial Summary), or calculate, the following data: a. Net revenues in 2005. b. Cost of goods sold in

> This problem is based on the 2008 annual report of Intel Corporation in the appendix. Find in the Selected Financial Data (also known as the Five-Year Financial Summary), or calculate, the following data: a. Percentage of R&D relative to net revenues in

> Required: a. For the year ended December 31, 2009, Finco, Inc. reported earnings per share of $3.12. During 2010 the company had a 3-for-1 stock split. Calculate the 2009 earnings per share that will be reported in Finco’s 2010 annual report for comparat

> Following are selected data from the November 30, 2008, and November 25, 2007, consolidated balance sheets and income statements for the years then ended for Levi Strauss & Co. and Subsidiaries. All amounts are reported in thousands. Required: Calc

> To what extent is the auditors’ opinion an indicator of a company’s future financial success and future cash dividends to stockholders?

> Richards, Inc. incurred the following costs during May: Raw materials used . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 662,000 Direct labor . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . 1,304,000 Manufactur

> It is impossible for an auditor to “guarantee” that a company’s financial statements are free of all error because the cost to the company to achieve absolute accuracy (even if that were possible) and the cost of the auditor’s verification would be prohi

> Refer to the “Corporate Governance & Ethics” disclosures provided under the “Investor Relations” link on Intel Corporation’s Web site. Identify the principal topics covered in those disclosures. Are there other topics that you believe would be appropriat

> During the fiscal year ended September 30, 2011, Worrell, Inc., had a 2-for-1 stock split and a 5% stock dividend. In its annual report for 2011, the company reported earnings per share for the year ended September 30, 2010, on a restated basis, of $0.60

> Find and read management’s statement of responsibility in the annual report that you obtained either as a result of completing Exercise 1.1 or otherwise. Identify the principal topics covered in that statement. Are there other topics that you believe wou

> Refer to the Intel Corporation annual report for 2008 in the appendix or to the most recent full annual report that you have downloaded from Intel’s Web site. Find and scan the financial review (notes to consolidated financial statements). Read the indep

> McDonald’s Corp McDonald’s conducts operations worldwide and is managed in three primary geographic segments: America, Europe, and Asia/Pacific, Middle East and Africa (APMEA). A hybrid geographic/corporate segment (&a

> Following is a statement of cash flows (indirect method) for Hartford, Inc., for the year ended December 31, 2011. Also shown is a partially completed comparative balance sheet as of December 31, 2011 and 2010: HARTFORD, INC. Statement of Cash Flows For

> The following information is available from Gray Co.’s accounting records for the year ended December 31, 2010 (amounts in millions): Cash dividends declared and paid. . . . . . . . . . . . . . . . . . . . . . . . . $ 350 Retirement of bonds payable at

> The following information is available from Bromfield Co.’s accounting records for the year ended December 31, 2010 (amounts in millions): Cash dividends declared and paid. . . . . . . . . . . . . . . . . . . . . . . . . $ 340 Interest and taxes paid .

> Following is a partially completed balance sheet for Epsico, Inc., at December 31, 2010, together with comparative data for the year ended December 31, 2009. From the statement of cash flows for the year ended December 31, 2010, you determine the followi

> Milan, Inc. manufactures digital voice recorders. During 2010, total costs associated with manufacturing 208,000 of the new MV-5253 model (introduced this year) were as follows: Raw materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

> The financial statements of Simon Co. include the following items (amounts in thousands): For the Year Ended December 31, Income Statement 2011 Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

> Franklin Co. has experienced gross profit ratios for 2010, 2009, and 2008 of 33%, 30%, and 31%, respectively. On April 3, 2011, the firm’s plant and all of its inventory were destroyed by a tornado. Accounting records for 2011, which were available becau

> The following information is available from the accounting records of Spenser Co. for the year ended December 31, 2010: Selling, general, and administrative expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 51,000 Accounts

> The following information is available from the accounting records of Manahan Co. for the year ended December 31, 2010: Net cash provided by fi nancing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $112,000 Div

> Freedom Co. purchased a new machine on July 2, 2010, at a total installed cost of $44,000. The machine has an estimated life of five years and an estimated salvage value of $6,000. Required: a. Calculate the depreciation expense for each year of the ass

> Early in January 2010, Tellco, Inc. acquired a new machine and incurred $100,000 of interest, installation, and overhead costs that should have been capitalized but were expensed. The company earned net operating income of $1,000,000 on average total ass

> Renter Co. acquired the use of a machine by agreeing to pay the manufacturer of the machine $900 per year for 10 years. At the time the lease was signed, the interest rate for a 10-year loan was 12%. Required: a. Use the appropriate factor from Table 6-

> Prepare an answer sheet with the following column headings. For each of the following transactions or adjustments, indicate the effect of the transaction or adjustment on assets, liabilities, and net income by entering for each account affected the accou

> Prepare an answer sheet with the column headings that follow. For each of the following transactions or adjustments, indicate the effect of the transaction or adjustment on assets, liabilities, and net income by entering for each account affected the acc

> Trout Pro Co. manufactures fishing equipment. During 2010, total costs associated with manufacturing 35,000 fly-cast fishing rods (a new product introduced this year) were as follows: Raw materials . . . . . . . . . . . . . . . . . . . . . . . . . . . .

> Goodwill arises when one firm acquires the net assets of another firm and pays more for those net assets than their current fair market value. Suppose that Target Co. had operating income of $90,000 and net assets with a fair market value of $300,000. Ta

> Assume that fast-food restaurants generally provide an ROI of 15%, but that such a restaurant near a college campus has an ROI of 18% because its relatively large volume of business generates an above-average turnover (sales ∕ assets). The replacement va

> Using a present value table, your calculator, or a computer program present value function, verify that the present value of $100,000 to be received in five years at an interest rate of 16%, compounded annually, is $47,610. Calculate the present value of

> Using a present value table, your calculator, or a computer program present value function, calculate the present value of a. A car down payment of $3,000 that will be required in two years, assuming an interest rate of 10%. b. A lottery prize of $6 mil

> The information presented here represents selected data from the December 31, 2010, balance sheets and income statements for the year then ended for three firms: Required: Calculate the missing amounts for each firm. Firm A Firm B Firm C Total asse

> Kleener Co. acquired a new delivery truck at the beginning of its current fiscal year. The truck cost $26,000 and has an estimated useful life of four years and an estimated salvage value of $4,000. Required: a. Calculate depreciation expense for each y

> Millco, Inc., acquired a machine that cost $240,000 early in 2010. The machine is expected to last for eight years, and its estimated salvage value at the end of its life is $24,000. Required: a. Using straight-line depreciation, calculate the depreciat

> Assume that a company chooses an accelerated method of calculating depreciation expense for financial statement reporting purposes for an asset with a five-year life. Required: State the effect (higher, lower, no effect) of accelerated depreciation rela

> Alpha, Inc., and Beta Co. are sheet metal processors that supply component parts for consumer product manufacturers. Alpha, Inc., has been in business since 1980 and is operating in its original plant facilities. Much of its equipment was acquired in the

> For each of the following expenditures, indicate the type of account (asset or expense) in which the expenditure should be recorded. Explain your answers. a. $400 for repairing damage that resulted from the careless unloading of a new machine. b. $14,00

> Galva set Industries manufactures and sells custom-made windows. Its job costing system was designed using an activity-based costing approach. Direct materials and direct labor costs are accumulated separately, along with information concerning three man

> For each of the following expenditures, indicate the type of account (asset or expense) in which the expenditure should be recorded. Explain your answers. a. $15,000 annual cost of routine repair and maintenance expenditures for a fleet of delivery vehi

> Crow Co. purchased some of the machinery of Hare, Inc., a bankrupt competitor, at a liquidation sale for a total cost of $33,600. Crow’s cost of moving and installing the machinery totaled $3,200. The following data are available: Req

> Dorsey Co. has expanded its operations by purchasing a parcel of land with a building on it from Bibb Co. for $90,000. The appraised value of the land is $20,000, and the appraised value of the building is $80,000. Required: a. Assuming that the buildin

> Please refer to Case 4.26 on pages 144–145 for the financial statement data needed for the analysis of this case. You should also review the solution to Case 4.26, provided by your instructor, before attempting to complete this case.) Y

> Answer the following questions using data from the Intel Corporation annual report in the appendix: Required: a. Find the discussion of depreciation methods used by Intel on page 695. Explain why the particular method is used for the purpose described.

> At the beginning of the current fiscal year, the balance sheet for Davis Co. showed liabilities of $320,000. During the year liabilities decreased by $18,000, assets increased by $65,000, and paid in capital increased from $30,000 to $192,000. Dividends

> The inventory records of Kuffel Co. reflected the following information for the year ended December 31, 2010: Required: a. Assume that Kuffel Co. uses a periodic inventory system. Calculate cost of goods sold and ending inventory under FIFO and LIFO. b

> The following data are available for Sellco for the fiscal year ended on January 31, 2011: Sales….. . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . ……… . 1,600 units Beginning inventory . . . . . . . . . .. . . . . . . . . . . 500 units

> Mower- Blower Sales Co. started business on January 20, 2010. Products sold were snow blowers and lawn mowers. Each product sold for $350. Purchases during 2010 were as follows: The December 31, 2010, inventory included 10 blowers and 25 mowers. Assume

> A portion of the current assets section of the December 31, 2010, balance sheet for Gibbs Co. is presented here: The company’s accounting records revealed the following information for the year ended December 31, 2011: Sales (all on

> Med Tech, Inc. manufactures and sells diagnostic equipment used in the medical profession. Its job costing system was designed using an activity-based costing approach. Direct materials and direct labor costs are accumulated separately, along with inform

> A portion of the current assets section of the December 31, 2011, balance sheet for Carr Co. is presented here: The company’s accounting records revealed the following information for the year ended December 31, 2011: Sales (all on a

> The following is a portion of the current asset section of the balance sheets of HiROE Co., at December 31, 2011 and 2010: Required: a. Describe how the allowance amount at December 31, 2011, was most likely determined. b. If bad debts expense for 2011

> The following is a portion of the current assets section of the balance sheets of Avanti’s, Inc., at December 31, 2011 and 2010: Required: a. If $11,800 of accounts receivable were written off during 2011, what was the amount of bad d

> Branson Co. received its bank statement for the month ending May 31, 2010, and reconciled the statement balance to the May 31, 2010, balance in the Cash account. The reconciled balance was determined to be $18,600. The reconciliation recognized the follo

> Beckett Co. received its bank statement for the month ending June 30, 2010, and reconciled the statement balance to the June 30, 2010, balance in the Cash account. The reconciled balance was determined to be $4,800. The reconciliation recognized the foll

> a. If the beginning balance of the Inventory account and the cost of items purchased or made during the period are correct, but an error resulted in overstating the firm’s ending inventory balance by $5,000, how would the firm’s cost of goods sold be aff

> At the beginning of its current fiscal year, Willie Corp.’s balance sheet showed assets of $12,400 and liabilities of $7,000. During the year, liabilities decreased by $1,200. Net income for the year was $3,000, and net assets at the en

> a. Use the horizontal model or write the journal entry to record the payment of a one-year insurance premium of $3,000 on March 1. b. Use the horizontal model or write the adjusting entry that will be made at the end of every month to show the amount of

> Natco, Inc., uses the FIFO inventory costflow assumption. In a year of rising costs and prices, the firm reported net income of $480,000 and average assets of $3,000,000. If Natco had used the LIFO cost-flow assumption in the same year, its cost of goods

> Proponents of the LIFO inventory cost-flow assumption argue that this costing method is superior to the alternatives because it results in better matching of revenue and expense. Required: a. Explain why “better matching” occurs with LIFO. b. What is th

> Evans, Inc., had current liabilities at November 30 of $137,400. The firm’s current ratio at that date was 1.8. Required: a. Calculate the firm’s current assets and working capital at November 30. b. Assume that management paid $30,600 of accounts payab

> Moiton Co.’s assets include notes receivable from customers. During fiscal 2010, the amount of notes receivable averaged $46,250, and the interest rate of the notes averaged 6.4%. Required: a. Calculate the amount of interest income earned by Moiton Co.

> Agrico, Inc., accepted a 10-month, 13.8% (annual rate), $4,500 note from one of its customers on June 15; interest is payable with the principal at maturity. Required: a. Use the horizontal model or write the entry to record the interest earned by Agric

> a. Calculate the approximate annual rate of return on investment of the following cash discount terms: 1. 1/15, n30. 2. 2/10, n60. 3. 1/10, n90. b. Which of these terms, if any, is not likely to be a significant incentive to the customer to pay promptly?

> Annual credit sales of Nadak Co. total $340 million. The firm gives a 2% cash discount for payment within 10 days of the invoice date; 90% of Nadak’s accounts receivable are paid within the discount period. Required: a. What is the total amount of cash

> On January 1, 2010, the balance in Kubera Co.’s Allowance for Bad Debts account was $9,720. During the year, a total of $23,900 of delinquent accounts receivable was written off as bad debts. The balance in the Allowance for Bad Debts account at December

> On January 1, 2010, the balance in Tabor Co.’s Allowance for Bad Debts account was $13,400. During the first 11 months of the year, bad debts expense of $21,462 was recognized. The balance in the Allowance for Bad Debts account at November 30, 2010, was

> a. Show the reconciling items in a horizontal model or write the adjusting journal entry (or entries) that should be prepared to reflect the reconciling items of Exercise 5.2. b. What is the amount of cash to be included in the August 31 balance sheet fo

> Charlie and Mari belle Brown have owned and operated a retail furniture store for more than 30 years. They have employed an independent CPA during this time to prepare various sales tax, payroll tax, and income tax returns, as well as financial statement

> a. Show the reconciling items in a horizontal model or write the adjusting journal entry (or entries) that should be prepared to reflect the reconciling items of Exercise 5.1. b. What is the amount of cash to be included in the October 31 balance sheet f

> On November 1, 2010, Wenger Co. paid its landlord $25,200 in cash as an advance rent payment on its store location. The six-month lease period ends on April 30, 2011, at which time the contract may be renewed. Required: a. Use the horizontal model or wr

> The following table summarizes the beginning and ending inventories of Decatur Manufacturing, Inc., for the month of March: Feb. 28 Mar. 31 Raw materials . . . . . . . . . . . . . . . . . . . . . . . $ 53,600 $ 44,160 Work in process . . . . . . . . . .

> Set up a horizontal model in the following format: Required: a. Enter the beginning (December 29, 2007) and ending (December 27, 2008) account balances for Accounts Receivable, Inventories, and Accounts Payable. Find these amounts on the balance sheet

> Calco, Inc., rents its store location. Rent is $1,500 per month, payable quarterly in advance. On July 1, a check for $4,500 was issued to the landlord for the July–September quarter. Required: Use the horizontal model to show the effects on the financi

> On January 10, 2010, the first day of the spring semester, the cafeteria of The Defiance College purchased for cash enough paper napkins to last the entire 16-week semester. The total cost was $4,800. Required: Use the horizontal model to show the effe