Finance Assignment

  

Understanding Financial Statements, Cash Flows and Taxes

*Complete the problems in an Excel spreadsheet. Be sure to show your work to receive credit; no hard keys.

Problem 2-1: Preparing Financial Statements

  

Information below is for Warner Manufacturing,   Inc. for the year ended December 31, 20x1 except where beginning of year   numbers indicated. All amounts in SAR unless otherwise stated.

Using   the information below:

1. Prepare an income statement with the proper   title

2. Prepare end of year balance sheet with the   proper title

3. Calculate net working capital

4. Calculate the debt ratio

*Complete the problems in an Excel spreadsheet. Be sure to show   your work to receive credit; no hard keys.

  

DATA

 

Depreciation expense

66,000

 

Cash 

220,000

 

Long-Term Debt 

330,000

 

Net Sales 

615,000

 

Accounts payable 

102,000

 

Marketing and general and administrative     expenses

79,000

 

Buildings and Equipment 

895,000

 

Notes payable 

7,5000

 

Accounts receivable 

156,000

 

Interest expense 

4,750

 

Accrued expenses

7,900

 

Common Stock 

289,000

 

Cost of Goods sold 

297,000

 

Inventory 

99,300

 

Taxes 

67,300

 

Accumulated Depreciation 

-26,3000

 

Prepaid expenses 

14,500

 

Taxes payable 

55,000

 

Retained earnings 

262,900

 

 

 

 

 

 

Problem 2-2 Preparing Statement of Cash Flows

 

Given the following information, prepare a   statement of cash flows.

  

DATA

 

Increase in accounts receivable

30

 

Increase in inventories

30

 

Operating Income

95

 

Interest Expense

30

 

Increase in accounts payable

25

 

Dividends

15

 

Increase in common stock

20

 

Increase in net fixed assets

23

 

Depreciation Expense

12

 

Income taxes

17

 

Beginning cash

20

 

Assume all amounts are in 000's SAR.