ACTG 2300 Lecture 17: Day 17 Notes

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purplecicada511

7 Feb 2017

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Scenario analysis: in case the assumptions change. Direct: +cash collections (cash sales, cash payments (salaries, purchasing dm/wip/fg, s&a exp) Indirect (indirectly determining cash starting from income: income, +/- adjustments. Favorable or unfavorable (does not mean good or bad) Favorable: has a positive effect on the income: without the variance, income would"ve been lower, without the variance, income would"ve been higher. Unfavorable: has a negative effect on the income. Flexible budget = budgeted cost * actual volume. Flexible budget answers the question (cid:498)what would have the budget been if i knew the actual volume? (cid:499) Activity variance = flexible budget planning budget. Spending variance = actual cost flexible budget cost. Revenue variance = flexible budget revenues actual revenues. Only can be caused by: variance in volume. Depend on: price variances, mix variances. Depend on: quantity variances, price variances. Quantity of dm * price of dm. Product of a quantity of input * price of that input: quantity * price.

Related Questions

Use the cash-flow below to make a Summary AnalysisStatement of Cash Flows.

Example: http://imgur.com/a/8r4lSâ

	2015	2014	2013
Cashflows from operating activities:
Netincome	$ 2,409	$ 2,088	$ 2,061
Adjustments to reconcile net income to net cash provided byoperating activities:	$ -	$ -	$ -
Depreciation and amortization (including amounts in discontinuedoperations)	$ 1,127	$ 1,029	$ 946
Stock-based compensation	$ 394	$ 327	$ 285
Excesstax benefits on stock-based awards	$ (86)	$ (84)	$ (61)
Othernon-cash operating activities, net	$ (5)	$ (63)	$ 7
Deferred income taxes	$ (101)	$ (63)	$ 7
Changes in operating assets and liabilities:
Increase in merchandise inventories	$ (890)	$ (563)	$ (898)
Increase in accounts payable	$ 880	$ 529	$ 718
Otheroperating assets and liabilities, net	$ 557	$ 699	$ 386
Netcash provided by operating activities	$ 4,285	$ 3,984	$ 3,437
Cashflows from investing activities:
Purchases of short-term investments	$ (1,501)	$ (2,503)	$ (2,572)
Maturities and sales of short-term investments	$ 1,434	$ 2,406	$ 2,385
Additions to property and equipment	$ (2,393)	$ (1,993)	$ (2,083)
Otherinvesting activities, net	$ (20)	$ (3)	$ 19
Netcash used in investing activities	$ (2,480)	$ (2,093)	$ (2,251)
Cashflows from financing activities:
Changein bank checks outstanding	$ (45)	$ 96	$ (70)
Repayments of short-term borrowings	$ (51)	$ (103)	$ (287)
Proceeds from short-term borrowings	$ 51	$ 68	$ 326
Proceeds from issuance of long-term debt	$ 1,125	$ 117	$ 3,717
Minimum tax withholdings on stock-based awards	$ (178)	$ (164)	$ (121)
Excesstax benefits on stock-based awards	$ 86	$ 84	$ 61
Repurchases of common stock	$ (481)	$ (334)	$ (36)
Cashdividend payments	$ (2,865)	$ (584)	$ (3,560)
Otherfinancing activities, net	$ 34	$ 34	$ 14
Netcash provided by financing activities	$ (2,324)	$ (786)	$ 44
Net(decrease) increase in cash and cash equivalents	$ (937)	$ 1,094	$ 1,116
Effectof foreign currency translation on cash and cash equivalents	$ (418)	$ (11)	$ (114)
Cashand cash equivalents at beginning of period	$ 5,738	$ 4,644	$ 3,528
Cash and cashequivalents at end of period	$ 4,801	$ 5,738	$ 4,644

Supplemental disclosure of cash flow information:
Cashpaid during the year for:
Interest (reduced by $14, $11 and $12, interest capitalized in2015, 2014 and 2013, respectively)	$ 117	$ 109	$ 86
Incometaxes, net	$ 1,186	$ 869	$ 1,001
Supplemental disclosure of non-cash flow information:
Property acquired under build-to-suit and capital leases	$ 109	$ -	$ 11

coffeeeagle440

urgent need it an hour wil rate

The comparative balance sheets of Posner Company, for Years 1 and 2 ended December 31, appear below in condensed form.

1		Year 2	Year 1
2	Cash	$53,000.00	$50,000.00
3	Accounts Receivable (net)	37,000.00	48,000.00
4	Inventories	108,500.00	100,000.00
5	Investments		70,000.00
6	Equipment	573,200.00	450,000.00
7	Accumulated Depreciation-Equipment	(142,000.00)	(176,000.00)
8		$629,700.00	$542,000.00
9	Accounts Payable	$62,500.00	$43,800.00
10	Bonds Payable, Due Year 2		100,000.00
11	Common Stock, $10 par	325,000.00	285,000.00
12	Paid-In Capital in Excess of ParâCommon Stock	80,000.00	55,000.00
13	Retained Earnings	162,200.00	58,200.00
14		$629,700.00	$542,000.00

The income statement for the current year is as follows:

1	Sales		$625,700.00
2	Cost of merchandise sold		340,000.00
3	Gross profit		$285,700.00
4	Operating expenses:
5	Depreciation expense	$26,000.00
6	Other operating expenses	68,000.00	94,000.00
7	Income from operations		$191,700.00
8	Other revenue and expense:
9	Gain on sale of investment	$4,000.00
10	Interest expense	(6,000.00)	(2,000.00)
11	Income before income tax		$189,700.00
12	Income tax		60,700.00
13	Net income		$129,000.00

Additional data for the current year are as follows:

(a)	Fully depreciated equipment costing $60,000 was scrapped, no salvage, and new equipment was purchased for $183,200.
(b)	Bonds payable for $100,000 were retired by payment at their face amount.
(c)	5,000 shares of common stock were issued at $13 for cash.
(d)	Cash dividends declared and paid, $25,000.

Required:

Prepare a statement of cash flows using the indirect method of reporting cash flows from operating activities. Refer to the Labels and Amount Descriptions list provided for the exact wording of the answer choices for text entries. Be sure to complete the heading of the statement. Use the minus sign to indicate cash outflows, cash payments, decreases in cash, or any negative adjustments.

Labels and Amount Descriptions

Labels
For the Year Ended December 31, Year 2
Amount Descriptions
Cash from sale of common stock
Cash from sale of investments
Cash paid for dividends
Cash paid for purchase of equipment
Cash paid to retire bonds payable
Decrease in accounts payable
Decrease in accounts receivable
Decrease in cash
Decrease in inventories
Depreciation
Gain on sale of investment
Increase in accounts payable
Increase in accounts receivable
Increase in cash
Increase in inventories
Loss on sale of investment
Net cash flow from financing activities
Net cash flow from investing activities
Net cash flow from operating activities
Net cash flow used for financing activities
Net cash flow used for investing activities
Net cash flow used for operating activities
Net income
Net loss

Statement of Cash Flows

Posner Company

Statement of Cash Flows

1	Cash flows from operating activities:
2
3	Adjustments to reconcile net income to net cash flow from operating activities:
4
5
6	Changes in current operating assets and liabilities:
7
8
9
10
11	Cash flows from investing activities:
12
13
14
15	Cash flows from financing activities:
16
17
18
19
20
21	Cash at the beginning of the year
22	Cash at the end of the year

violetclam852

A fire destroyed your firmâs ending balance sheet and income statement after the year-end
but before the financial statements are released. However, you have been successful in obtaining the
numbers for the beginning balance sheet and the statement of cash flows, which are provided to you and
your team members in Excel format. Fields representing the missing balance sheet and income statement
are End of year2 in the Excel sheet

CONSOLIDATED BALANCE SHEETS (USD $)	End of year 2	End of year 1
In Thousands, unless otherwise specified	End of year 2	End of year 1
Current assets:
Cash and cash equivalents	ã	598
Receivables, net	ã	230
Inventories, net	ã	2309
Other current assets	ã	47
Total current assets	ã	3184
Property and equipment, net of accumulated depreciation	ã	1292
Assets held for sale	ã	1
Goodwill	ã	76
Intangible assets, net	ã	29
Other assets, net	ã	32
Assets, Total	ã	4614
Current liabilities:	ã	0
Current portion of long-term debt	ã	0
Accounts payable	ã	2030
Accrued expenses	ã	380
Other current liabilities	ã	150
Total current liabilities	ã	2560
Long-term debt	ã	604
Other long-term liabilities	ã	239
Commitments and Contingencies	ã	0
Stockholders Equity Attributable to Parent [Abstract]	ã	0
Preferred stock, nonvoting, $00001 par value	ã	0
Common stock, voting, $00001 par value	ã	0
Additional paid-in capital	ã	520
Treasury stock, at cost	ã	-27
Accumulated other comprehensive income (loss)	ã	3
Retained earnings	ã	715
Total stockholders equity	ã	1210
Liabilities and Stockholders Equity, Total	ã	4613


CONSOLIDATED STATEMENTS OF OPERATIONS (USD $)	12 Months Ended
In Thousands, except Per Share data, unless otherwise specified	Year 2
Net sales	ã
Cost of sales, including purchasing and warehousing costs	ã
Gross profit	ã
Selling, general and administrative expenses	ã
Operating income	ã
Interest expense	ã
Other income, net	ã
Total other, net	ã
Income before provision for income taxes	ã
Provision for income taxes	ã
Net income	ã


CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)	12 Months Ended
In Thousands, unless otherwise specified	Year 2
Cash flows from operating activities:
Net income	$392
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	208
Share-based compensation	13
Loss on property and equipment, net	1
Other	2
Provision for deferred income taxes	-2
Excess tax benefit from share-based compensation	-16
Increase Decrease in Operating Capital
Receivables, net	-32
Inventories, net	-204
Other assets	11
Accounts payable	113
Accrued expenses	63
Other liabilities	-4
Net cash provided by operating activities	545
Cash flows from investing activities:
Purchases of property and equipment	-196
Payments to Acquire Businesses, Gross	-186
Sale of certain assets of acquired business	19
Proceeds from sales of property and equipment	1
Net cash used in investing activities	-362
Cash flows from financing activities:
(Decrease) increase in bank overdrafts	-3
Decrease in financed vendor accounts payable	0
Issuance of senior unsecured notes	449
Payment of debt related costs	-9
Borrowings under credit facilities	0
Payments on credit facilities	0
Dividends paid	-18
Proceeds from the issuance of common stock, primarily exercise of stock options	4
Tax withholdings related to the exercise of stock appreciation rights	-22
Excess tax benefit from share-based compensation	16
Repurchase of common stock	-81
Contingent payment accrued on acquisitions	5
Other	-1
Net cash provided by (used in) financing activities	331
Net increase (decrease) in cash and cash equivalents	514
Cash and cash equivalents, beginning of period	598
Cash and cash equivalents, end of period	1,112
Supplemental cash flow information:
Interest paid	35
Income tax payments	219
Non-cash transactions:
Accrued purchases of property and equipment	21
Retirement of common stock	0
Contingent consideration accrued on acquisitions	0
Changes in other comprehensive income	1
Declared but unpaid cash dividends	$4

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ACTG 2300 Lecture 17: Day 17 Notes

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