Chapter 1: Q12DQ. (page 29)
What work do tax accounting professionals perform in addition to preparing tax returns?
Tax is a compulsory payment to the government and tax accountants prepare tax returns, future tax planning, etc.
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As of December 31, 2017, Armani Company’s financial records show the following items and amounts.
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $10,000
Accounts receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,000
Supplies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,000
Equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,000
Accounts payable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,000
Common stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,000
Retained earnings, Dec. 31, 2016 . . . . . . . . . . . . . . . . 4,000
Retained earnings, Dec. 31, 2017 . . . . . . . . . . . . . . . . 6,000
Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,000
Consulting revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . 33,000
Rental revenue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22,000
Salaries expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,000
Rent expense . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12,000
Selling and administrative expenses . . . . . . . . . . . . . . 8,000
Required Prepare the 2017 year-end income statement for Armani Company
Coca-Cola and PepsiCo both produce and market beverages that are direct competitors. Key financial figures (in \( millions) for these businesses for a recent year follow.
Check (1a) 11.3%; (1b) 9.2%
Key Figures (\) millions) Coca-Cola PepsiCo
Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . \(46,542 \)66,504
Net income . . . . . . . . . . . . . . . . . . . . . . . 8,634 6,462
Average assets . . . . . . . . . . . . . . . . . . . . 76,448 70,518
Required 3. Write a one-paragraph memorandum explaining which company you would invest your money in and why. (Limit your explanation to the information provided.)
Coca-Cola and PepsiCo both produce and market beverages that are direct competitors. Key financial figures (in \( millions) for these businesses for a recent year follow.
Check (1a) 11.3%; (1b) 9.2%
Key Figures (\) millions) Coca-Cola PepsiCo
Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . \(46,542 \)66,504
Net income . . . . . . . . . . . . . . . . . . . . . . . 8,634 6,462
Average assets . . . . . . . . . . . . . . . . . . . . 76,448 70,518
Required 2. Which company is more successful in its total amount of sales to consumers?
The following financial statement information is from five separate companies.
Company Company Company Company Company
V W X Y Z
December 31, 2016
Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . \(54,000 \) 80,000 \(141,500 \)92,500 $144,000
Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . 25,000 60,000 68,500 51,500 ?
December 31, 2017
Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . 59,000 100,000 186,500 ? 170,000
Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . 36,000 ? 65,800 42,000 42,000
During year 2017
Stock issuances . . . . . . . . . . . . . . . . . . . 5,000 20,000 ? 48,100 60,000
Net income (or loss) . . . . . . . . . . . . . . . . ? 40,000 18,500 24,000 32,000
Cash dividends . . . . . . . . . . . . . . . . . . . 5,500 2,000 0 20,000 8,000
Required 3. Compute the amount of stock issuances for Company X during 2017
Following is selected financial information of Kia Company for the year ended December 31, 2017.
Cash used by investing activities . . . . . . . . . . . . . . . . . $(2,000)
Net increase in cash . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,200
Cash used by financing activities . . . . . . . . . . . . . . . . (2,800)
Cash from operating activities . . . . . . . . . . . . . . . . . . . 6,000
Cash, December 31, 2016 . . . . . . . . . . . . . . . . . . . . . . 2,300
Required Prepare the 2017 year-end statement of cash flows for Kia Company
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