Question: What is the primary difference between interim

> Presented below are condensed financial statements adapted from those of two actual companies competing in the pharmaceutical industry—Johnson and Johnson (J&J) and Pfizer, Inc. ($ in millions, except per share amounts). Required:

> Financial statements for Askew Industries for 2018 are shown below (in thousands): 2018 Income Statement Sales ………………â€&brv

> Presented below are the 2018 income statement and comparative balance sheets for Santana Industries. Additional information for the 2018 fiscal year ($ in thousands): 1. Cash dividends of $1,000 were declared and paid. 2. Equipment costing $4,000 was p

> The chief accountant for Grandview Corporation provides you with the company’s 2018 statement of cash flows and income statement. The accountant has asked for your help with some missing figures in the company’s compar

> The Diversified Portfolio Corporation provides investment advice to customers. A condensed income statement for the year ended December 31, 2018, appears below: Service revenue ………â€&

> On September 17, 2018, Ziltech, Inc., entered into an agreement to sell one of its divisions that qualifies as a component of the entity according to generally accepted accounting principles. By December 31, 2018, the company’s fiscal year-end, the divis

> Kandon Enterprises, Inc., has two operating divisions; one manufactures machinery and the other breeds and sells horses. Both divisions are considered separate components as defined by generally accepted accounting principles. The horse division has been

> Esquire Comic Book Company had income before tax of $1,000,000 in 2018 before considering the following material items: 1. Esquire sold one of its operating divisions, which qualified as a separate component according to generally accepted accounting pri

> Chance Company had two operating divisions, one manufacturing farm equipment and the other office supplies. Both divisions are considered separate components as defined by generally accepted accounting principles. The farm equipment component had been un

> On December 31, 2018, the end of the fiscal year, Revolutionary Industries completed the sale of its robotics business for $9 million. The business segment qualifies as a component of the entity according to GAAP. The book value of the assets of the segm

> The following incorrect income statement was prepared by the accountant of the Axel Corporation: Required: Prepare a multiple-step income statement for 2018 applying generally accepted accounting principles. The income tax rate is 40%. AXEL CORPORA

> The trial balance for Lindor Corporation, a manufacturing company, for the year ended December 31, 2018, included the following income accounts: The trial balance does not include the accrual for income taxes. Lindor’s income tax rate

> The following is a partial trial balance for General Lighting Corporation as of December 31, 2018: 300,000 shares of common stock were outstanding throughout 2018. Income tax expense has not yet been recorded. The income tax rate is 40%. Required: 1.

> The following is a partial trial balance for the Green Star Corporation as of December 31, 2018: 100,000 shares of common stock were outstanding throughout 2018. Required: 1. Prepare a single-step income statement for 2018, including EPS disclosures.

> Pandora Corporation operates several factories in the Midwest that manufacture consumer electronics. The December 31, 2018, year-end trial balance contained the following income statement items: Required: Calculate the company’s opera

> The 2018 income statement of Anderson Medical Supply Company reported net sales of $8 million, cost of goods sold of $4.8 million, and net income of $800,000. The following table shows the company’s comparative balance sheets for 2018 a

> The following is a portion of the condensed income statement for Rowan, Inc., a manufacturer of plastic containers: Required: 1. Determine Rowan’s inventory turnover. 2. What information does this ratio provide? Net sales $2,460,0

> Listed below are several terms and phrases associated with income statement presentation and the statement of cash flows. Pair each item from List A (by letter) with the item from List B that is most appropriately associated with it. List A List B 1

> Access the FASB Accounting Standards Codification at the FASB website (www.fasb.org). Determine the specific citation for each of the following items: 1. The calculation of the weighted average number of shares for basic earnings per share purposes 2. Th

> The FASB Accounting Standards Codification represents the single source of authoritative U.S. generally accepted accounting principles. Required: 1. Obtain the relevant authoritative literature on earnings per share using the FASB Accounting Standards C

> Explain what is meant by the term earnings quality.

> Refer to the situation described in E 4–20. In E 4–20 Presented below is the 2018 income statement and comparative balance sheet information for Tiger Enterprises. Required: Prepare the cash flows from operating act

> Presented below is the 2018 income statement and comparative balance sheet information for Tiger Enterprises. Required: Prepare Tiger’s statement of cash flows, using the indirect method to present cash flows from operating activities

> The statement of cash flows for the year ended December 31, 2018, for Bronco Metals is presented below. Required: Prepare the statement of cash flows assuming that Bronco prepares its financial statements according to International Financial Reporting

> Chew Corporation prepares its statement of cash flows using the indirect method of reporting operating activities. Net income for the 2018 fiscal year was $1,250,000. Depreciation expense of $140,000 was included with operating expenses in the income sta

> Cemptex Corporation prepares its statement of cash flows using the indirect method to report operating activities. Net income for the 2018 fiscal year was $624,000. Depreciation and amortization expense of $87,000 was included with operating expenses in

> The following transactions occurred during March 2018 for the Wainwright Corporation. The company owns and operates a wholesale warehouse. 1. Issued 30,000 shares of capital stock in exchange for $300,000 in cash. 2. Purchased equipment at a cost of $40

> The accounting records of Hampton Company provided the data below ($ in thousands). Net income …………………………………………………………… $ 17,300 Depreciation expense ………………………………………………… 7,800 Increase in accounts receivable ………………………………….. 4,000 Decrease in inventory ………

> Refer to the situation described in E 4–13. In E 4–13 The following summary transactions occurred during 2018 for Bluebonnet Bakers: Cash Received from: Customers ……………………………………………….. $ 380,000 Interest on note receivable ………………………………. 6,000 Principal o

> The following summary transactions occurred during 2018 for Bluebonnet Bakers: Cash Received from: Customers ……………………………………………….. $ 380,000 Interest on note receivable ………………………………. 6,000 Principal on note receivable …………………………… 50,000 Sale of investment

> The statement of cash flows classifies all cash inflows and outflows into one of the three categories shown below and lettered from a through c. In addition, certain transactions that do not involve cash are reported in the statement as noncash investing

> Briefly explain the difference between the single-step and multiple-step income statement formats.

> The Massoud Consulting Group reported net income of $1,354,000 for its fiscal year ended December 31, 2018. In addition, during the year the company experienced a positive foreign currency translation adjustment of $240,000 and had unrealized losses on i

> O’Reilly Beverage Company reported net income of $650,000 for 2018. In addition, the company deferred a $60,000 pretax loss on derivatives and had pretax net unrealized holding gains on investment securities of $40,000. Prepare a separate statement of co

> Refer to the situation described in BE 4–8. Assume instead that the estimated fair value of the segment’s assets, less costs to sell, on December 31 was $7 million rather than $10 million. Prepare the lower portion of the 2018 income statement beginning

> Refer to the situation described in BE 4–7. Assume that the semiconductor segment was not sold during 2018 but was held for sale at year-end. The estimated fair value of the segment’s assets, less costs to sell, on December 31 was $10 million. Prepare th

> On December 31, 2018, the end of the fiscal year, California Microtech Corporation completed the sale of its semiconductor business for $10 million. The business segment qualifies as a component of the entity according to GAAP. The book value of the asse

> The following are partial income statement account balances taken from the December 31, 2018, year-end trial balance of White and Sons, Inc.: restructuring costs, $300,000; interest revenue, $40,000; before-tax loss on discontinued operations, $400,000;

> The following is a partial year-end adjusted trial balance. Income tax expense has not yet been recorded. The income tax rate is 40%. Determine the following: (a) Operating income (loss), (b) Income (loss) before income taxes, and (c) Net income (loss)

> Refer to the situation described in BE 4–1. If the company’s accountant prepared a multiple-step income statement, what amount would appear in that statement for (a) Operating income and (b) Nonoperating income? In BE 4–1: The adjusted trial balance of

> During 2018, Rogue Corporation reported sales revenue of $600,000. Inventory at both the beginning and end of the year totaled $75,000. The inventory turnover ratio for the year was 6.0. What amount of gross profit did the company report in its 2018 inco

> Refer to the facts described in BE 4–16. Show the DuPont framework’s calculation of the three components of the 2018 return on shareholders’ equity for Anderson TV and Appliance. In BE 4–16 The 2018 income statement for Anderson TV and Appliance reporte

> Refer to the situation described in BE 4–1. Prepare a multiple-step income statement for 2018. Ignore EPS disclosures. In BE 4–1: The adjusted trial balance of Pacific Scientific Corporation on December 31, 2018, the end of the company’s fiscal year, co

> The 2018 income statement for Anderson TV and Appliance reported sales revenue of $420,000 and net income of $65,000. Average total assets for 2018 was $800,000. Shareholders’ equity at the beginning of the year was $500,000 and $20,000 was paid to share

> Universal Calendar Company began the year with accounts receivable (net) and inventory balances of $100,000 and $80,000, respectively. Year-end balances for these accounts were $120,000 and $60,000, respectively. Sales for the year of $600,000 generated

> Refer to the situation described in BE 4–11 and BE 4–12. How might your solution to those brief exercises differ if Hilliard Healthcare Co. prepares its statement of cash flows according to International Financial Reporting Standards? In BE 4–11 and BE

> Net income of Mansfield Company was $45,000. The accounting records reveal depreciation expense of $80,000 as well as increases in prepaid rent, salaries payable, and income taxes payable of $60,000, $15,000, and $12,000, respectively. Prepare the cash f

> Refer to the situation described in BE 4–11. Prepare the cash flows from investing and financing activities sections of HHC’s statement of cash flows. In BE 4–11 The following are summary cash transactions that occurred during the year for Hilliard Heal

> The following are summary cash transactions that occurred during the year for Hilliard Healthcare Co. (HHC): Cash received from: Customers ……………………………………………. $ 660,000 Interest on note receivable …………………………. 12,000 Collection of note receivable …………………….

> Interim reports are issued for periods of less than a year, typically as quarterly financial statements. Should these interim periods be viewed as separate periods or integral parts of the annual period?

> Show the DuPont framework’s calculation of the three components of return on shareholders’ equity. What information about a company do these ratios offer?

> Show the calculation of the following profitability ratios: (1) The profit margin on sales, (2) The return on assets, and (3) The return on shareholders’ equity. What information about a company do these ratios offer?

> The income statement is a change statement. Explain what is meant by this.

> Show the calculation of the following activity ratios: (1) The receivables turnover ratio, (2) The inventory turnover ratio, and (3) The asset turnover ratio. What information about a company do these ratios offer?

> Describe the potential statement of cash flows classification differences between U.S. GAAP and IFRS.

> Distinguish between the direct method and the indirect method for reporting the results of operating activities in the statement of cash flows.

> Explain what is meant by noncash investing and financing activities pertaining to the statement of cash flows. Give an example of one of these activities.

> Identify and briefly describe the three categories of cash flows reported in the statement of cash flows.

> Describe the purpose of the statement of cash flows.

> Define comprehensive income. What are the two ways companies can present comprehensive income?

> Define earnings per share (EPS). For which income statement items must EPS be disclosed?

> The correction of a material error discovered in a year subsequent to the year the error was made is considered a prior period adjustment. Briefly describe the accounting treatment for prior period adjustments.

> Accountants very often are required to make estimates, and very often those estimates prove incorrect. In what period(s) is the effect of a change in an accounting estimate reported?

> The adjusted trial balance of Pacific Scientific Corporation on December 31, 2018, the end of the company’s fiscal year, contained the following income statement items ($ in millions): sales revenue, $2,106; cost of goods sold, $1,240; selling expenses,

> What effect will applying variable costing have on the income statement and the balance sheet?

> What is the difference between absorption costing and variable costing?

> Mallory Manufacturing Company has a maximum productive capacity of 210,000 units per year. Normal capacity is 180,000 units per year. Standard variable manufacturing costs are $10 per unit. Fixed factory overhead is $360,000 per year. Variable selling ex

> The board of directors of Garden City Gaskets, Inc., set the profit goal for the calendar year 2011 at $2,200,000. It also established a bonus plan in which the top five officers of the company will share $150,000 if the profit goal is met or exceeded. I

> Go to the Web site for Delta Air Lines, which is linked to the text Web site at www.cengage.com/accounting/vanderbeck. Click on ‘‘Specials,’’ then ‘‘Web Fares’’ and do the following: 1. Find a fare departing from a city located closest to you with a dest

> A company had income of $50,000, using variable costing for a given period. Beginning and ending inventories for the period were 18,000 units and 13,000 units, respectively. If the fixed overhead application rate was $2 per unit, what was the net income,

> The following production data came from the records of LeShaq Athletic Enterprises for the year ended December 31, 2011: Materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $480,000 Labor . .

> The chief executive officer (CEO) of Button Corporation attended a conference in which one of the sessions was devoted to variable costing. The CEO was impressed by the presentation and has asked that the following data of Button Corporation be used to p

> Using the information presented in E10-1 Prepare comparative income statements for March (a) under absorption costing and (b) Under variable costing. Information presented in E10-1 Lynne Products Company uses a process cost system and applies actual fact

> Lynne Products Company uses a process cost system and applies actual factory overhead to work in process at the end of the month. The following data came from the records for the month of March: Direct materials . . . . . . . . . . . . . . . . . . . . .

> Julian Manufacturing, Inc., wishes to determine the profitability of its products and asks the cost accountant to make a comparative analysis of sales, cost of sales, and distribution costs of each product for the year. The accountant gathers the followi

> Alpha Company needs 20,000 units of a certain part to use in its production cycle. The following information is available: Cost to Alpha to make the part: Direct materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 4 Direct labor .

> Dribble, Inc., manufactures basketballs. The company’s forecasted income statement for the year, before any special orders, is as follows: Fixed costs included in the forecasted income statement are $4,000,000 in manufacturing cost of

> Fill in the missing figures for each of the following independent cases: Case 1 Case 2 Units produced .... 1,200 Standard hours per unit 2 0.6 Standard hours allowed 1,200 Standard rate per hour 24 ? Actual hours used 2,340 1,220 Actual labor cost ?

> Lewis Products, Inc., desires to earn an after-tax income of $150,000. It has fixed costs of $1,000,000, a unit sales price of $500, and unit variable costs of $200. The company is in the 30% tax bracket. 1. How many dollars of sales revenue must be earn

> A company has prepared the following statistics regarding its production and sales at different capacity levels. 1. At what point is break-even reached in sales dollars? In units? 2. If the company is operating at 60% capacity, should it accept an offer

> A company has sales of $1,000,000, variable costs of $250,000, and fixed costs of $600,000. Compute the following: 1. Contribution margin ratio. 2. Break-even sales volume. 3. Margin of safety ratio. 4. Net operating income as a percentage of sales.

> Leisure Products, Inc., manufactures and sells two products, golf balls and tennis balls. Fixed costs are $100,000, and unit sales are 60,000 sheaths of golf balls and 40,000 cans of tennis balls. The unit sales prices and unit variable costs are as foll

> A new product is expected to have sales of $100,000, variable costs of 60% of sales, and fixed costs of $20,000. 1. Using graph paper, construct a break-even chart and label the sales line, total cost line, fixed cost line, break-even point, and net inco

> Jackson Company sells its only product for $50 per unit. Fixed expenses total $800,000 per year. Variable expenses are $1,000,000 when 40,000 units are sold. How many units must be sold to earn a net operating income of $75,000?

> The sales price per unit is $13 for the Dakota Company’s only product. The variable cost per unit is $5. In year 2011, the company sold 80,000 units, which was 10,000 units above the break-even point. Compute the following: 1. Total fixed expenses. (Hint

> Grecian Products, Inc., has two divisions, Athens and Sparta. For the month ended March 31, Athens had sales and variable costs of $500,000 and $225,000, respectively, and Sparta had sales and variable costs of $800,000 and $475,000, respectively. Athens

> The fixed overhead budgeted for Hamlet Company at an expected capacity of 500,000 units is $1,500,000. Variable costing is used internally, and the net income is adjusted to an absorption costing net income at year-end. Data collected over the last three

> Distinguish between a direct cost and an indirect cost when the cost object is the job.

> On December 1, Lake George Production Company had a work in process inventory of 1,200 units that were complete as to materials and 50% complete as to labor and overhead. December 1 costs follow: Materials . . . . . . . . . . . . . . . . . . . . . . . .

> What factors would you consider in deciding whether to use direct labor dollars or direct labor hours in charging overhead to jobs in a service firm?

> What factors help to explain the growth of service businesses relative to manufacturing businesses in the United States in recent years?

> Name the four categories that performance measures are typically divided into, and give an example of a performance measure for each category.

> Give five examples of nonfinancial performance measures.

> Explain the concept of a cost/benefit decision and how it relates to job costing systems.

> What are the two main things that an activity-based costing system attempts to accomplish relative to direct and indirect costs?

> Explain how a budgeted income statement for a service business may be used for both planning and control purposes.

> What is the difference between the accounting treatment of overhead for a service business and for a manufacturer?

> Why is it important for professional labor hours to be budgeted with extreme care?

> The budget for the Baldwin Equipment, Inc. job in P9-1 consisted of the following amounts: Partners’ salary and overhead . . . . . . . . . . . . . $6,300 Associates’ salary and overhead . . . . . . . . . . . 9,175 Travel . . . . . . . . . . . . . . . .

> Manufacturing data for the months of January and February in the Mixing Department of Cappy Cleaning Products follow: All materials are added at the start of the process. Labor and factory overhead are added evenly throughout the process. No units were