Use Apple Inc.’s consolidated statement of cash flows along with the company’s other consolidated financial statements, all in Appendix A and online in the filings section of http://www.sec.gov, to answer the following questions. Requirements 1. By which method does Apple Inc. report cash flows from operating activities? How can you tell? 2. What type of activity (operating, financing, or investing) generated the most cash flows for Apple in 2014? Which activity type(s) used cash in 2014? Judging by the statement of cash flows only, is Apple a healthy company? Explain your answer. 3. Suppose Apple Inc., reported net cash flows from operating activities by using the direct method. Compute the following amounts for the year ended December 31, 2014 (ignore the statement of cash flows, and use only Apple Inc.’s income statement and balance sheet). a. Calculate collections from customers and others. Prepare a T-account for Gross Accounts Receivable. Prepare another T-account for Allowance for Doubtful Accounts. Calculate the beginning and ending gross amounts of Gross Accounts Receivable by adding the beginning and ending balances of Allowance for Doubtful Accounts ($99 million and $86 million, respectively) to the net accounts receivable at both the beginning and end of the year. Assume that all sales are on account. Also assume that the company uses the percentage of net sales method for estimating doubtful accounts expense and that the company estimates this amount at 0.5%. b. Calculate payments to suppliers. Apple Inc. calls its cost of goods sold “Cost of Sales.” Assume all inventory is purchased on account and that all cash payments to suppliers are made from accounts payable. c. Evaluate 2014 for Apple Inc. in terms of net income, total assets, stockholders' equity, cash flows from operating activities, and overall results. Be specific. (Challenge)
> Suppose Lyndell Corporation completed the following international transactions: Requirements 1. Record these transactions in Lyndell’s journal and show how to report the foreign-currency transaction gain or loss on the income stateme
> Daughtry Cosmetics in P11-48A holds significant promise for carving a niche in its industry. A group of Irish investors is considering purchasing the company’s outstanding common stock. Daughtry’s stock is currently selling for $24 per share. A BetterLife
> Use the data in P11-48A to prepare the Daughtry Cosmetics statement of retained earnings for the year ended December 31, 2016. Use the Statement of Retained Earnings in the End-of-Chapter Summary Problem as a model. From P11-48A The following informati
> The following information was taken from the records of Daughtry Cosmetics, Inc., at December 31, 2016: Requirements 1. Using the End-of-Chapter Summary Problem as an example, prepare Daughtry Cosmetics’ single-step income statement,
> Assume that you are considering purchasing stock as an investment. You have narrowed the choice to Disc.com and Holiday Shops and have assembled the following data. Selected income statement data for current year: Selected balance-sheet and market pric
> Comparative financial statement data of Arch Optical Mart follow: Other information: 1. Market price of Arch common stock: $88.17 at December 31, 2016, and $77.01 at December 31, 2015 2. Common shares outstanding: 18,000 during 2016 a
> Financial statement data of Eastland Engineering include the following items: Requirements 1. Compute Eastland’s current ratio, debt ratio, and earnings per share. Round all ratios to two decimal places. 2. Compute the three ratios
> You are evaluating two companies as possible investments. The two companies, which are similar in size, are commuter airlines that fly passengers up and down the West Coast. All other available information has been analyzed, and your inves
> For each of the situations listed, identify which of three principles (integrity, objectivity and independence, or due care) from the AICPA Code of Professional Conduct that is violated. Assume all persons listed in the situations are members of the AICP
> Top managers of Gordon Products, Inc., have asked for your help in comparing the company’s profit performance and financial position with the average for the industry. The accountant has given you the compa
> Net sales, net income, and total assets for Urbana Shipping, Inc., for a five-year period follow: Requirements 1. Compute trend percentages for each item for 2013 through 2016. Use 2012 as the base year and round to the nearest percent.
> Assume that you are considering purchasing stock as an investment. You have narrowed the choice to Star.com and Westlake Shops and have assembled the following data. Selected income statement data for the current year: Selected balance-sheet and market
> Comparative financial statement data of Sanfield Optical Mart follow: Other information: 1. Market price of Sanfield common stock: $89.38 at December 31, 2016, and $85.67 at December 31, 2015 2. Common shares outstandin
> Financial statement data of Morgan Engineering include the following items: Requirements 1. Compute Morgan’s current ratio, debt ratio, and earnings per share. Round all ratios to two decimal places. 2. Compute the three ratios afte
> To prepare the statement of cash flows, accountants for Franklin Electric Company have summarized 2016 activity in two accounts: Franklin Electric’s 2016 income statement and balance sheet data follow: Requirements 1
> The following accounts and related balances of Ginger Designers, Inc., as of December 31, 2016, are arranged in no particular order: Requirements 1. Prepare Ginger’s classified balance sheet in the account format at December 31, 2016
> Fall River Specialties, Inc., reported the following statement of stockholders’ equity for the year ended October 31, 2016: Requirements Answer these questions about Fall River Specialties’ stockholdersâ€
> Assume Sweet Treats, Inc., completed the following transactions during 2016, the company’s 10th year of operations: Requirements 1. Analyze each transaction in terms of its effect on the accounting equation of Sweet Treats, Inc. 2.
> Dublin Jewelry Company reported the following summarized balance sheet at December 31, 2016: During 2017, Dublin Jewelry completed these transactions that affected stockholders’ equity: Requirements 1. Journalize Dublin Jewelry&aci
> For each of the situations listed, identify which of three principles (integrity, objectivity and independence, or due care) from the AICPA Code of Professional Conduct is violated. Assume all persons listed in the situations are members of the AICPA. (N
> Classic Outdoor Furniture Company included the following stockholders’ equity on its year-end balance sheet at February 28, 2017: Requirements 1. Identify the different issues of stock that Classic Outdoor Furniture Company has outst
> Jackson Corp. has the following stockholders’ equity information: Jackson’s charter authorizes the company to issue 9,000 shares of 6% preferred stock with par value of $110 and 450,000 shares of no-par common stock. The company issued 2,250 shares of t
> The partners who own Canal Kayaks wished to avoid the unlimited personal liability of the partnership form of business, so they incorporated as Canal Kayaks, Inc. The charter from the state of Nevada authorizes the corporation to issue 125,000 shares of
> Paulus Specialties, Inc., reported the following statement of stockholders’ equity for the year ended October 31, 2016: Requirements Answer these questions about Paulus Specialties’ stockholders’ e
> The following accounts and related balances of Seagull Designers, Inc., as of December 31, 2016, are arranged in no particular order: Requirements 1. Prepare Seagull’s classified balance sheet in the account format at December 31, 20
> Assume Dairy Freeze, Inc., completed the following transactions during 2016, the company’s 10th year of operations: Requirements 1. Analyze each transaction in terms of its effect on the accounting equation of Dairy Freeze, Inc. 2.
> Walker Jewelry Company reported the following summarized balance sheet at December 31, 2016: During 2017, Walker Jewelry completed these transactions that affected stockholders’ equity: Requirements 1. Journalize Walker Jewelry&aci
> Yoder Outdoor Furniture Company included the following stockholders’ equity on its year-end balance sheet at February 28, 2017: Requirements 1. Identify the different issues of stock that Yoder Outdoor Furniture Company has outstandi
> Rollo Corp. has the following stockholders’ equity information: Rollo’s charter authorizes the company to issue 5,000 shares of 7% preferred stock with par value of $110 and 650,000 shares of no-par common stock. The company issued 2,500 shares of the pr
> The partners who own Lane Rafts wished to avoid the unlimited personal liability of the partnership form of business, so they incorporated as Lane Rafts, Inc. The charter from the state of California authorizes the corporation to issue 160,000 shares of
> For each of the situations listed, identify which of three principles (integrity, objectivity and independence, or due care) from the AICPA Code of Professional Conduct that is violated. Assume all persons listed in the situations are members of the AICP
> The 2016 and 2015 comparative balance sheets and 2016 income statement of Lombardi Supply Corp. follow: Lombardi Supply had no noncash investing and financing transactions during 2016. During the year, there were no sales of land or equ
> The comparative balance sheets of Barberton Movie Theater Company at September 30, 2016 and 2015, reported the following: Barberton’s transactions during the year ended September 30, 2016, included the following: Requirements 1. Pre
> Johnson Software Corp. has assembled the following data for the years ending December 31, 2016 and 2015: Requirement 1. Prepare Johnson Software Corp.’s statement of cash flows using the indirect method to report operating activitie
> Use the Pruitt Motors, Inc., data from P12-67B. Requirements 1. Prepare Pruitt’s income statement for the year ended December 31, 2016. Use the singlestep format, with all revenues listed together and all expenses together. 2. Prepare Pruitt’s balanc
> Pruitt Motors, Inc., was formed on January 1, 2016. The following transactions occurred during 2016: On January 1, 2016, Pruitt issued its common stock for $440,000. Early in January, Pruitt made the following cash payments: a. $180,000 for equipment
> The comparative balance sheets of Donna Dunn Design Studio, Inc., at June 30, 2016, and 2015, and transaction data for fiscal 2016, are as follows: Transaction data for the year ended June 30, 2016, follows: a. Net income, $70,600 b. D
> To prepare the statement of cash flows, accountants for Percy Electric Company have summarized 2016 activity in two accounts: Percy Electric’s 2016 income statement and balance sheet data follow: Requirements 1. Prep
> Crutchfield Furniture Gallery, Inc., provided the following data from the company’s records for the year ended October 31, 2017: a. Credit sales, $584,200 b. Loan to another company, $12,800 c. Cash payments to purchase plant assets, $44,400 d. Cost o
> Use the King Supply Corp. data from P12-62A. Requirements 1. Prepare the 2016 statement of cash flows by using the direct method. 2. How will what you learned in this problem help you evaluate an investment? From P12-62A. The 2016 and 2015 comparati
> The 2016 and 2015 comparative balance sheets and 2016 income statement of King Supply Corp. follow: King Supply had no noncash investing and financing transactions during 2016. During the year, there were no sales of land or equipment,
> George Campbell paid $50,000 for a franchise that entitled him to market Success Associates software programs in the countries of the European Union. Campbell intended to sell individual franchises for the major language groups of western Europe—German,
> The accounting (not the income tax) records of Consolidated Publications, Inc., provide the income statement for the year ended December 31, 2016. 2016 Total revenue....
> Sophie Miller, accountant for Northern Foods, Inc., was injured in a snowboarding accident. While she was recuperating, another, inexperienced employee prepared the following income statement for the fiscal year ended June 30, 2016: The
> Turnover Specialists, Ltd. (TSL), specializes in taking underperforming companies to a higher level of performance. TSL’s capital structure at December 31, 2015, included 11,000 shares of $2.30 preferred stock and 125,000 shares of common stock. During 2
> Suppose Taupe Corporation completed the following international transactions: Requirements 1. Record these transactions in Taupe’s journal and show how to report the foreign-currency transaction gain or loss on the income statement.
> Clark Cosmetics in Problem P11-55B holds significant promise for carving a niche in its industry. A group of Irish investors is considering purchasing the company’s outstanding common stock. Clark’s stoc
> Use the data in P11-55B to prepare the Clark Cosmetics statement of retained earnings for the year ended December 31, 2016. Use the Statement of Retained Earnings in the End-of-Chapter Summary Problem as a model. From P11-55B The following information
> The global economic recession that started in 2007, and that persists in certain sectors, has impacted every business, but it was especially hard on banks, automobile manufacturing, and retail companies. Banks were largely responsible for the recession.
> Refer to the Apple Inc., consolidated financial statements in Appendix A and online in the filings section of http://www.sec.gov. Requirements 1. Apple Inc.’s consolidated statements of operations do not mention income from continuing operations. Why n
> Apple Inc.’s consolidated financial statements appear in Appendix A and online in the filings section of http://www.sec.gov. Requirements 1. Refer to Apple’s Consolidated Balance Sheets and Note 7 (Shareholders’ Equity). Describe the class of stock that
> Columbia Motors is having a bad year. Net income is only $37,000. Also, two important overseas customers are falling behind in their payments to Columbia, and Columbia’s accounts receivable are ballooning. The company desperately needs a loan. The Columb
> Use the consolidated financial statements and the data in Apple Inc.’s annual report in Appendix A and online in the filings section of http://www.sec.gov to evaluate the company’s comparative performance for 2014 versus 2013. Requirements 1. Perform ho
> This case is based on the consolidated financial statements of Under Armour, Inc., given in Appendix B and online in the filings section of http://www.sec.gov. In particular, this case uses Under Armour, Inc.’s, Consolidated Balance Sheets and Consolidated
> Use the Under Armour, Inc., consolidated financial statements in Appendix B and online in the filings section of http://www.sec.gov to address the following questions. Requirements 1. Compute ratios for 2013 and 2014 to determine the following for Under
> Refer to the Under Armour, Inc.’s, consolidated financial statements in Appendix B and online in the filings section of http://www.sec.gov.Focus on the year ended December 31, 2014. Requirements 1. What is(are) Under Armour, Inc.’s, main source(s) of ca
> This case is based on the Under Armour, Inc., consolidated financial statements in Appendix B and online in the filings section of http://www.sec.gov. Requirements 1. Focus on the company’s Consolidated Statements of Income for the three years ended Dec
> Assume that Holloway Stores completed the following foreign-currency transactions: Requirements 1. Journalize these transactions for Holloway. Focus on the gains and losses caused by changes in foreign-currency rates. Round your answers to the nearest
> During 2016, Flash Bytes, Inc., had sales of $7.66 billion, operating profit of $2.10 billion, and net income of $3.00 billion. EPS was $4.70. On January 2, 2017, one share of Flash Bytes common stock was priced at $54.00 on the New York Stock Exchange.
> The Hooper Book Company accounting records include the following for 2016 (in thousands): Requirements 1. Prepare Hooper Book Company’s single-step income statement for the year ended December 31, 2016, including EPS. Hooper had 1,00
> Suppose Searstown Cycles, Inc., reported a number of special items on its income statement. The following data, listed in no particular order, came from Searstown’s financial statements (amounts in thousands): Requireme
> Curtis Golf Company has requested that you perform a vertical analysis of its balance sheet to determine the component percentages of its assets, liabilities, and stockholders’ equity. A1 Curtis Golf Company Balance Sheet December
> The income statement of Royal Bank of Singapore reported the following results of operations: Income before income taxes...................................................... $187,046 Income tax expense....................................................
> Compute trend percentages for Sagamore Valley Sales & Service’s total revenue and net income for the following five-year period, using year 0 as the base year. Round to the nearest full percent. Which grew faster du
> Prepare a horizontal analysis of the comparative income statements of Connor Music Co. Round percentage changes to the nearest one-tenth percent (three decimal places). A1 Connor Music Co. Comparative Income Statements Years Ended December 31, 2016
> What were the dollar amounts of change and the percentage of each change in Majestic Mountain Lodge’s net working capital during 2016 and 2015? Is this trend favorable or unfavorable? 2016 2015 2014 Total current assets $643,260 $2
> Compute the following items for the statement of cash flows: a. Beginning and ending Accounts Receivable are $42,000 and $35,000, respectively. Credit sales for the period total $139,000. How much are cash collections from customers? b. Cost of Goods So
> The accounting records of Central Distributors, Inc., reveal the following: Requirement 1. Prepare the cash flows from operating activities section of the statement of cash flows using the indirect method. Use the format of the operating a
> A company uses the indirect method to prepare the statement of cash flows. Indicate whether each of the following transactions affects an operating activity, an investing activity, a financing activity, or a noncash investin
> McDowell Investments specializes in low-risk government bonds. Identify each of McDowell’s transactions as operating (O), investing (I), financing (F), noncash investing and financing (NIF), or a transactio
> The following information appears in a footnote to the 2014 financial statements of Nike, Inc.: Requirements 1. Based on this information, what do you think are Nike, Inc.’s, reportable segments as of the end of its 20
> During the year ended December 31, 2016, Martinson International Corporation earned $4,200,000 in net income after taxes. The company reported $180,000 of net unrealized losses on available-for sale securities, net of taxes, and $180,000 in foreign-curre
> EverClean, Inc., a household products chain, reported a prior-period adjustment in 2016. An accounting error caused net income of 2015 to be overstated by $12 million. Retained earnings at December 31, 2015, as previously reported, was $345 million. Net
> St. Genevieve Petroleum Company is an independent oil producer in Baton Parish, Louisiana. In February, company geologists discovered a pool of oil that tripled the company’s proven reserves. Prior to disclosing the new oil to the public, St. Genevieve q
> Crocker Holding Company operates numerous businesses, including motel, auto rental, and real estate companies. The year 2016 was interesting for Crocker, which reported the following on its income statement (in millions): During 2016, Crocker had the f
> Two companies with different economic-value-added (EVA®) profiles are Daniels Company, Inc., and Granger Bank Limited. Adapted versions of the two companies’ financial statements are presented he
> Evaluate the common stock of Bastille Distributing Company as an investment. Specifically, use the three common stock ratios to determine whether the common stock increased or decreased in attractiveness during the past year. (The number o
> For 2016 and 2015, compute return on sales (ROS), asset turnover (AT), return on assets (ROA), leverage (L), return on common stockholders’ equity (ROE), gross profit percentage (GP), operating income percentage (OI), and
> Irvin Furniture Company has requested that you determine whether the company’s ability to pay its current liabilities and long-term debts improved or deteriorated during 2016. To answer this question, compute the following ratios for 20
> The financial statements of Carver News, Inc., include the following items: Requirements 1. Using Exhibit 13-8 as a model, compute the following ratios for 2016 and 2015: a. Current ratio b. Quick (acid-test) ratio c. Inventory turno
> Identify any weaknesses revealed by the statement of cash flows of Sunshine Fruit, Inc. A1 Sunshine Fruit, Inc. Statement of Cash Flows 1 For the Current Year 2 Operating activities: 3 Net income 4 Add (subtract) adjustments to reconc
> Prepare a comparative common-size income statement for Mitchell Music Co. using the 2016 and 2015 data of E13-27B and rounding to four decimal places. From E13-27B A1 Mitchell Music Co. Comparative Income Statements Years Ended December 31, 2016 an
> Fox Den Golf Company has requested that you perform a vertical analysis of its balance sheet to determine the component percentages of its assets, liabilities, and stockholders’ equity. A1 Fox Den Golf Company Balance Sheet Decembe
> Compute trend percentages for Valley View Sales & Service’s total revenue and net income for the following five-year period, using year 0 as the base year. Round to the nearest full percent. Which grew faster during
> Turnberry Golf Corporation’s long-term debt agreements make certain demands on the business. For example, Turnberry may not purchase treasury stock in excess of the balance of retained earnings. Also, long-term debt may not exceed stockholders’ equity, a
> Nate Smith and Darla Jones have written a computer program for a virtual reality video game system; it is expected to be more popular than any other gaming system on the market currently. They need additional capital to market the product, and they plan
> Recall exercise 2 from Chapter 5 in which a country imposes an import fee on the crude oil it imports. Imagine that all the crude oil imports to the country are made by ships owned by its nationals. The Association of Petroleum Shippers argues that the r
> Recall exercise 2 from Chapter 5 in which a country imposes an import fee on the crude oil it imports. Assume that prior to the imposition of the import fee, the country annually consumed 900 million short tons of coal, all domestically mined, at a price
> Recall exercise 1 from Chapter 5 in which an increase in the toll on a highway from $.40 to $.50 would reduce use of the highway by 5,000 cars per week. Data From exercise 1 of Chapter 5: Suppose the government is considering an increase in the toll on
> Imagine that the net present value of a hydroelectric plant with a life of 70 years is $25.73 million and that the net present value of a thermal electric plant with a life of 35 years is $18.77 million. Rolling the thermal plant over twice to match the
> 1. How would the shadow price of a high school diploma change if the labor force participation rate for increase? 2. (Instructor provided spreadsheet required) How much would the shadow price of a diploma change if the probabilities of high school gradua
> 1. a. Why did Blomquist and his colleagues believe that contingent valuation was needed to fully assess the value of a 10 percent expansion of KCTCS? b. Did their findings suggest that they were correct? 2. Blomquist and his colleagues predict that will
> 1. If you were running a state welfare agency and had to choose one of the programs listed in the table, which table’s columns would you particularly focus upon? Why? 2. If you were running a state welfare agency and had to choose one of the programs li
> 1. What information would be needed to estimate the net benefits of a state-wide Alzheimer's disease screening program for 65 year olds? 2. Imagine that you wanted to use a life-course model similar to the Alzheimer's disease model to estimate the net be
> 1. Would you describe this study as a Distributional CBA? 2. Why is there no consumer surplus included as a benefit? 3. What weaknesses do you see in this CBA? If corrected, would they increase or decrease the expected NPV?
> Imagine Washington State is considering implementing a program that pays monetary awards to families when their high school age children meet certain goals (for example, school attendance, achievement on standardized tests, receiving regular dental check
> A town with a population of 164,250 persons who live in 39,050 households is considering introducing a recycling program that would require residents to separate paper from their household waste so that it can be sold rather than buried in a landfill lik
> 1. You are a decision-maker who has to decide whether to adopt the Tulsa IDA program on a permanent basis relying, in part, on the information provided by the CBA described in this case study. Required: a. The case study provides results for a range of
> Analysts wish to evaluate alternative surgical procedures for spinal cord injuries. The procedures have various probabilities of yielding the following results: Full recovery (FR) — the patient regains full mobility and suffers no chronic pain. Full fun
> A public health department is considering five alternative programs to encourage parents to have their preschool children vaccinated against a communicable disease. The following table shows the cost and number of vaccinations predicted for each program:
