Case Study
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acme-planning-spreadsheets-2013-10-07-2013_1.xlsPY Fin'l Stmts
| Acme Corp. | Prepared by: | |||
| Prior Year Financial Statements | ||||
| January 31, 2008 | ||||
| Acme Corporation | ||||
| Balance Sheet | ||||
| December 31, 2012 and 2011 | ||||
| Assets | 2012 | 2011 | ||
| Current Assets: | ||||
| Cash | $ 1,015,000 | $ 727,000 | ||
| Accounts receivable, net | 1,517,700 | 1,213,500 | ||
| Inventories | 556,000 | 249,000 | ||
| Other current assets | 280,000 | 353,500 | ||
| Total current assets | 3,368,700 | 2,543,000 | ||
| Machinery and equipment | 2,275,900 | 1,674,500 | ||
| Motor vehicles | 66,700 | 48,000 | ||
| Office equipment | 45,000 | 33,000 | ||
| Leasehold improvements | 197,500 | 181,500 | ||
| Gross equipment and leasehold improvements | 2,585,100 | 1,937,000 | ||
| Less accumulated depreciation and amortization | 1,375,000 | 965,500 | ||
| Net value | 1,210,100 | 971,500 | ||
| Other assets | 147,000 | 61,500 | ||
| Total Assets | $ 4,725,800 | $ 3,576,000 | ||
| Liabilities and Stockholders' Equity | ||||
| Current Liabilities: | ||||
| Accounts payable | 1,094,300 | 222,000 | ||
| Accrued expenses | 1,220,000 | 1,082,000 | ||
| Other current liabilities | 95,000 | 82,500 | ||
| Total current liabilities | 2,409,300 | 1,386,500 | ||
| Stockholders' Equity | ||||
| Common stock | 394,500 | 394,500 | ||
| Retained earnings | 1,922,000 | 1,795,000 | ||
| Total equity | 2,316,500 | 2,189,500 | ||
| Total liabilities and equity | $ 4,725,800 | $ 3,576,000 | ||
| Acme Corporation | ||||
| Statement of Income and Retained Earnings | ||||
| For the Years Ended December 31, 2012, 2011, 2010 | ||||
| 2012 | 2011 | 2010 | ||
| Net Sales | $ 9,358,000 | $ 8,979,000 | $ 7,340,600 | |
| Cost of Sales | 7,521,000 | 6,725,500 | 5,505,600 | |
| Gross Margin | 1,837,000 | 2,253,500 | 1,835,000 | |
| Selling, general and administrative expenses | 1,625,000 | 1,516,500 | 1,213,000 | |
| Income before income taxes | 212,000 | 737,000 | 622,000 | |
| Provision for income taxes | 85,000 | 297,500 | 248,000 | |
| Net income | $ 127,000 | $ 439,500 | $ 374,000 | |
| Retained earnings, beginning of year | 1,795,000 | 1,355,500 | 981,500 | |
| Retained earnings, ending of year | $ 1,922,000 | $ 1,795,000 | $ 1,355,500 | |
| Acme Corporation | ||||
| Statement of Cash Flows | ||||
| For the Years Ended December 31, 2012, 2011, 2010 | ||||
| 2012 | 2011 | 2010 | ||
| Cash flows from operating activities: | ||||
| Net income | $ 127,000 | $ 439,500 | $ 374,000 | |
| Adjustments | ||||
| Depreciation Expense | 409,500 | 97,000 | 87,000 | |
| (Increase) decrease in accounts receivable | (304,200) | (303,500) | (250,000) | |
| (Increase) decrease in inventories | (307,000) | (63,000) | (50,000) | |
| (Increase) decrease in other current assets | 73,500 | (88,500) | 35,000 | |
| Increase (decrease) in accounts payable | 872,300 | 123,000 | (70,000) | |
| Increase (decrease) in accrued expenses | 138,000 | 255,000 | (22,000) | |
| Increase (decrease) in other current liabilities | 12,500 | 8,500 | 11,000 | |
| Net cash provided by operating activities | $ 1,021,600 | $ 468,000 | $ 115,000 | |
| Cash flows from investing activities: | ||||
| Purchase of equipment & leasehold improvements | $ (648,100) | $ (272,500) | $ (209,000) | |
| Acquisition of other assets | (85,500) | (11,500) | (18,000) | |
| Net cash used in investing activities | $ (733,600) | $ (284,000) | $ (227,000) | |
| Net increase (decrease) in cash | $ 288,000 | $ 184,000 | $ (112,000) |
&L&F&R&A
PL1
| Acme Corp. | Prepared by: | |||||||
| Percentage Analysis - Planning | ||||||||
| 2012 | Common Size Ratio | 2011 | Common Size Ratio | $ | % | |||
| $ | $ | CHG | CHG | |||||
| Current Assets: | ||||||||
| Cash | $ 1,015,000 | 21.5% | $ 727,000 | 20.3% | 288,000 | 39.6% | ||
| Accounts receivable, net | 1,517,700 | 32.1% | 1,213,500 | 33.9% | 304,200 | 25.1% | ||
| Inventories | 556,000 | 249,000 | 7.0% | |||||
| Other current assets | 280,000 | 353,500 | 9.9% | |||||
| Total current assets | 3,368,700 | 2,543,000 | 71.1% | |||||
| Machinery and equipment | 2,275,900 | 1,674,500 | 46.8% | |||||
| Motor vehicles | 66,700 | 48,000 | 1.3% | |||||
| Office equipment | 45,000 | 33,000 | 0.9% | |||||
| Leasehold improvements | 197,500 | 181,500 | 5.1% | |||||
| Gross equipment & leasehold improve | 2,585,100 | 1,937,000 | 54.2% | |||||
| Less accumulated depr & amort | 1,375,000 | 965,500 | 27.0% | |||||
| Net value | 1,210,100 | 971,500 | 27.2% | |||||
| Other assets | 147,000 | 3.1% | 61,500 | 1.7% | 85,500 | 139.0% | ||
| Total Assets | $ 4,725,800 | $ 3,576,000 | 100.0% | |||||
| Current Liabilities: | ||||||||
| Accounts payable | 1,094,300 | 222,000 | 6.2% | |||||
| Accrued expenses | 1,220,000 | 1,082,000 | 30.3% | |||||
| Other current liabilities | 95,000 | 82,500 | 2.3% | |||||
| Total current liabilities | 2,409,300 | 1,386,500 | 38.8% | |||||
| Stockholders' Equity | ||||||||
| Common stock | 394,500 | 394,500 | 11.0% | |||||
| Retained earnings | 1,922,000 | 1,795,000 | 50.2% | |||||
| Total equity | 2,316,500 | 2,189,500 | 61.2% | |||||
| Total liabilities and equity | $ 4,725,800 | $ 3,576,000 | 100.0% | |||||
| 2012 | Common Size Ratio | 2011 | Common Size Ratio | $ | % | |||
| $ | $ | CHG | CHG | |||||
| Net Sales | $ 9,358,000 | 100.0% | $ 8,979,000 | 100.0% | ||||
| Cost of Sales | 7,521,000 | 80.4% | 6,725,500 | 74.9% | ||||
| Gross Margin | 1,837,000 | 19.6% | 2,253,500 | 25.1% | ||||
| Selling, general & administrative exp | 1,625,000 | 17.4% | 1,516,500 | 16.9% | ||||
| Income before income taxes | 212,000 | 2.3% | 737,000 | 8.2% | ||||
| Provision for income taxes | 85,000 | 0.9% | 297,500 | 3.3% | ||||
| Net income | $ 127,000 | 1.4% | $ 439,500 | 4.9% | ||||
| Audit Conclusions: |
&L&F&R&A
PL2
| Acme Corp. | Prepared by: | |||||
| Percentage Analysis - Planning | ||||||
| Industry Average 2012 | 2012 | 2011 | 2010 | |||
| Acid Test Ratio | =(cash + accounts receivable) / current liabilities | (times) | 1.7 | 1.4 | 1.5 | |
| Current Ratio | =current assets / current liabilities | (times) | 3.1 | 1.8 | 1.9 | |
| Day's Sales in Receivables | =accounts receivable / (net credit sales/365) | (days) | 40.0 | 59.2 | 49.3 | 45.2 |
| Cost of Goods Sold to Inventory | =cost of goods sold / average ending inventory | (times) | 38.0 | 39.7 | 47.5 | |
| Working Capital to Total Assets | =(current assets - current liabilities) / total assets | (percent) | 30.0% | 32.3% | 33.0% | |
| Debt to Equity | = total liabilities / total stockholders' equity | (times) | 0.5 | 0.6 | 0.6 | |
| Long-term Debt to Equity | = total long-term debt / total stockholders' equity | (percent) | 30.0% | 0.0% | 0.0% | |
| Return on Assets | = net income / average total assets | (percent) | 12.0% | 14.0% | 15.0% | |
| Return on Equity | = net income / average stockholders' equity | (percent) | 20.0% | 22.0% | 24.0% | |
| Operating Profit to Sales | = income before taxes / total sales | (percent) | 9.0% | 8.2% | 8.5% | |
| Net Income to Sales | = net income / total sales | (percent) | 5.0% | 4.9% | 5.1% | |
| Sales to Accounts Receivable | =total sales / average ending accounts receivable | (times) | 10.0 | 7.4 | 8.1 | |
| Sales to Inventory | =total sales / average ending inventory | (times) | 30.0 | 36.1 | 39.5 | |
| Sales to Working Capital | =total sales / (current assets - current liabilities) | (times) | 8.0 | 7.8 | 8.1 | |
| Sales to Fixed Assets | =total sales / net fixed assets | (times) | 10.0 | 9.2 | 9.2 | |
| Audit Conclusions: |
&L&F&R&A
