Financial Accounting: Tools for Business Decision Making, 8th Edition
8th Edition
ISBN: 9781118953808
Author: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso
Publisher: WILEY
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Chapter 1, Problem 1.13E
a.
To determine
Introduction:
Financial statements are a complete record of the financial transactions that takes place in a company at a particular point of time. It provides important financial information like assets, liabilities, revenues and expenses of the company to its internal and external users. It helps them to know the exact financial position of the company. There are four basic financial statements as shown in the figure below:
Basic Financial Statements
Figure (1)
To Prepare: Statement of cash flows for the year ended 31 December, 2017.
b.
To determine
Whether net cash provided by the operating activities was sufficient to finance the company’s investing activities.
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Suppose the following data are derived from the 2022 financial statements of Southwest Airlines. (All dollars are in millions.) Southwest has a December 31 year-end.
Cash balance, January 1, 2022
$1,370
Cash paid for repayment of debt
123
Cash received from issuance of common stock
130
Cash received from issuance of long-term debt
490
Cash received from customers
9,860
Cash paid for property and equipment
1,540
Cash paid for dividends
15
Cash paid for repurchase of common stock
1,050
Cash paid for goods and services
6,920
(a)After analyzing the data, prepare a statement of cash flows for Southwest Airlines for the year ended December 31, 2022. (Show amounts that decrease cash flow either with a negative sign preceding the number e.g. -15,000 or in parentheses e.g. (15,000). Enter amounts in millions, e.g. 45,000,000 would be entered as 45.)
Suppose the following data are derived from the 2022 financial statements of Southwest Airlines. (All dollars are in millions.) Southwest has a December 31 year-end.
Cash balance, January 1, 2022
$1,310
Cash paid for repayment of debt
129
Cash received from issuance of common stock
140
Cash received from issuance of long-term debt
480
Cash received from customers
9,630
Cash paid for property and equipment
1,450
Cash paid for dividends
15
Cash paid for repurchase of common stock
1,040
Cash paid for goods and services
6,570
After analyzing the data, prepare a statement of cash flows for Southwest Airlines for the year ended December 31, 2022. (Show amounts that decrease cash flow either with a negative sign preceding the number e.g. -15,000 or in parentheses e.g. (15,000). Enter amounts in millions, e.g. 45,000,000 would be entered as 45.)
The condensed balance sheet and income statement for Marjoram Company are presented below.
MARJORAM COMPANY
Balance Sheet
December 31, 2024
Cash
$ 19,000
Notes receivable (due August 15, 2025)
35,000
Accounts receivable (net)
48,400
Inventory
70,600
Property, plant, and equipment (net)
250,000
Intangible assets
12,400
Total assets
$ 435,400
Current liabilities
$ 108,400
Bonds payable (11%) (long-term)
100,000
Common stock
70,000
Retained earnings
157,000
Total liabilities and equity
$ 435,400
MARJORAM COMPANY
Income Statement
For the Year ended December 31, 2024
Sales
$ 704,000
Cost of goods sold
422,400
Gross profit
$ 281,600
Operating expenses
166,200
Operating income
$ 115,400
Interest expense
11,000
Income before income tax
$ 104,400
Income tax expense
31,320
Net income
$ 73,080
Required:
Compute the current ratio for Marjoram Company.
Note: Round your answer to 2 decimal places.
Chapter 1 Solutions
Financial Accounting: Tools for Business Decision Making, 8th Edition
Ch. 1 - Prob. 1QCh. 1 - Prob. 2QCh. 1 - Prob. 3QCh. 1 - Accounting is ingrained in our society and is...Ch. 1 - Prob. 5QCh. 1 - Prob. 6QCh. 1 - What are the three main types of business...Ch. 1 - Prob. 8QCh. 1 - Prob. 9QCh. 1 - Prob. 10Q
Ch. 1 - Prob. 11QCh. 1 - What are the three main categories of the...Ch. 1 - Prob. 13QCh. 1 - Prob. 14QCh. 1 - Prob. 15QCh. 1 - Which of these items are liabilities of White...Ch. 1 - How are each of the following financial statements...Ch. 1 - What is the purpose of the management discussion...Ch. 1 - Prob. 19QCh. 1 - Prob. 20QCh. 1 - Prob. 21QCh. 1 - Prob. 1.1BECh. 1 - Match each of the following types of evaluation...Ch. 1 - Indicate in which part of the statement of cash...Ch. 1 - Prob. 1.4BECh. 1 - Prob. 1.5BECh. 1 - Prob. 1.6BECh. 1 - Indicate which statement you would examine to find...Ch. 1 - Prob. 1.8BECh. 1 - Prob. 1.9BECh. 1 - Prob. 1.10BECh. 1 - Prob. 1.11BECh. 1 - Prob. 1.1DIECh. 1 - Prob. 1.2DIECh. 1 - Prob. 1.3ADIECh. 1 - Prob. 1.3BDIECh. 1 - Here is a list of words or phi uses discussed in...Ch. 1 - Prob. 1.3ECh. 1 - Prob. 1.4ECh. 1 - Prob. 1.5ECh. 1 - Prob. 1.6ECh. 1 - Prob. 1.7ECh. 1 - Prob. 1.8ECh. 1 - Prob. 1.9ECh. 1 - Prob. 1.10ECh. 1 - Prob. 1.11ECh. 1 - Prob. 1.12ECh. 1 - Prob. 1.13ECh. 1 - Prob. 1.14ECh. 1 - Prob. 1.15ECh. 1 - Prob. 1.16ECh. 1 - Prob. 1.17ECh. 1 - Prob. 1.1APCh. 1 - Financial decisions often place heavier emphasis...Ch. 1 - Prob. 1.3APCh. 1 - Prob. 1.4APCh. 1 - Prob. 1.5APCh. 1 - Prob. 1.1EYCTCh. 1 - Prob. 1.2EYCTCh. 1 - Prob. 1.3EYCTCh. 1 - INTERPRETING FINANCIAL STATEMENTS Xerox was not...Ch. 1 - Prob. 1.5EYCTCh. 1 - Prob. 1.6EYCTCh. 1 - Prob. 1.7EYCTCh. 1 - Prob. 1.8EYCTCh. 1 - Prob. 1.9EYCTCh. 1 - Prob. 1.10EYCTCh. 1 - Prob. 1.1IFRSCh. 1 - Prob. 1.2IFRSCh. 1 - Prob. 1.3IFRS
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