accounting assignement

BUS 222 Accounting 2

Assignment 2

Submission Date: 5th December 2012 [Week 12 Wednesday]

Introduction:

You now know how to read and prepare financial statements for different types of organizations like sole proprietors, partnerships and corporations. This Assignment is based on your ability to read the Financial Statements of Corporations. You will download the recent financial statements of the corporation allotted to you and would read them to answer questions based on it. The main objective of this project is to give you exposure to corporate financial statements. One primary purpose of publishing the financial statements of the company in the form of Annual Reports is to provide financial information to shareholders, and you will briefly examine some of that information.

Instructions:

1. Start the Assignment with a good Title page and an innovative introduction about your company. You can be as creative as you like. Show that you are really familiar with this company and understand the nature of its operation. The introduction should not be more than 2 pages.

2. Then copy and paste the following questions to the assignment and print it out. You will then answer the following questions as briefly as sensibly possible. The answer to the following questions should be handwritten.

I. General Questions:

1. What is the name of the company?

2. What is the date on the Financial Statements?

3. Name the different statements composed in the financial statement.

4. Who were the auditors?

5. Was the audit opinion "Qualified" or “Unqualified”. What does it mean?

6. What years were presented in the balance sheet?

7. What were total assets for the most recent year presented?

8. What was the retained earnings total for the most recent year presented?

9. What was net income for the most recent year presented?

10. How many footnotes (or notes) were there?

II. Questions from the Financial Statements:

Note: Include a description and interpretation for each ratio. Explain what the results of this ratio indicate about the company’s performance and/or results. You may separate the ratios on the basis of liquidity, profitability, solvency etc. (Refer the attached file for the formulas)

Calculate the following with proper formulas:

1. Current Ratio:

2. Debt/equity ratio:

3. Net Profit Margin,

4. Return on Assets:

5. Return on Equity:

6. Earnings per share:

7. Sales to Net Working Capital Ratio:

8. Asset Turnover Ratio:

9. Inventory Turnover Ratio:

10. Operating cycle:

III. Questions from the Footnotes:

1. Explain briefly any two accounting policies of this company that interests you.

2. Describe the share capital of the corporation in the latest year.

3. Is there any change in the EPS (Earning per Share) that you calculated and that shown in the consolidated statement of income? Give reasons.

4. When is dividends recognized by this corporation.

5. List the intangible assets and explain the accounting treatment.

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Happy Exploring!!