Posted: February 5th, 2019
Kaplan ACC499 unit 4 assignment (part 1 and 2)
Unit 4 Practice Activity: Financial Report
Analysis â Rainbow Paint Co.
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Note:This
is a practice activity to be performed before completing the Assignment for
this unit. Also,this is the data to be used as the basis for your Unit
9 Final Project. The solutions for the Unit 4 Practice activity are located here.
Rainbow
Paint Co.’s comparative financial statements for the years ending December 31,
2013 and 2012 are as follows. The market price of Rainbow Paint Co.’s common
stock was $30 on December 31, 1999 and $25 on December 31, 2013.
Rainbow Paint Co.
Comparative Income
Statement
For the Years Ended
December 31, 2013 and 2012
2013
2012
Sales
$ 5,125,000
$ 3,257,600
Sales returns and allowances
125,000
57,600
Net sales
$ 5,000,000
$ 3,200,000
Cost of goods sold
3,400,000
2,080,000
Gross profit
$ 1,600,000
$ 1,120,000
Selling expenses
650,000
464,000
Administrative expenses
325,000
224,000
Total operating expenses
$
975,000
$
688,000
Income from operations
$
625,000
$
432,000
Other income
25,000
19,200
Income before Interest & Taxes
$
$
451,200
650,000
Other expense (interest)
105,000
64,000
Income before income tax
$
545,000
$
387,200
Income tax expense
300,000
176,000
Net income
$
245,000
$
211,200
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========
Rainbow Paint Co.
Comparative Retained Earnings Statement
For the Years Ended December 31, 2013 and 2012
2013
2012
Retained
earnings, January 1
$
723,000
$
581,800
Add net
income for year
245,000
211,200
Total
$
968,000
$
793,000
Deduct
dividends:
On preferred stock
$
40,000
$
40,000
On common stock
45,000
30,000
Total
$
85,000
$
70,000
Retained earnings, December 31
$
883,000
$
723,000
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========
.gif”>Unit 4.jpg”> [AC499:
Bachelorâs Capstone in Accounting]
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Rainbow Paint C0,
Comparative Balance Sheet
December 31, 2013 and 2012
Assets
2013
2012
Current
assets:
Cash
$ 175,000
$
125,000
Marketable securities
150,000
50,000
Accounts receivable (net)
425,000
325,000
Inventories
720,000
480,000
Prepaid expenses
30,000
20,000
Total current assets
$ 1,500,000
$
1,000,000
Long-term
investments
250,000
225,000
Property,
plant, and equipment (net)
2,093,000
1,948,000
Total assets
$ 3,843,000
$
3,173,000
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========
Liabilities
Current
liabilities
$ 750,000
$
650,000
Long-term liabilities:
Mortgage
note payable, 10%, due 2016
$ 410,000
–
Bonds
payable, 8%, due 2017
800,000
$
800,000
Total
long-term liabilities
$ 1,210,000
$
800,000
Total liabilities
$
1,960,000
$
1,450,000
Stockholders’ Equity
Preferred 8% stock, $100
par
$ 500,000
$
500,000
Common
stock, $10 par
500,000
500,000
Retained
earnings
883,000
723,000
Total stockholders’
equity
$
1,883,000
$
1,723,000
Total
liabilities and stockholders’ equity
$ 3,843,000
$
3,173,000
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=========
Instructions:
Determine the following measures for 2013:
1. Working
capital
2. Current
ratio
3. Quick
ratio
4. Accounts
receivable turnover
5. Number of
days’ sales in receivables
6. Inventory
turnover
7. Number of
days’ sales in inventory
8. Ratio of
fixed assets to long-term liabilities
.gif”>Unit 4.jpg”> [AC499:
Bachelorâs Capstone in Accounting]
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9. Ratio of
liabilities to stockholders’ equity
10. Number of
times interest charges earned
11. Number of
times preferred dividends earned
12. Ratio of
net sales to assets
13. Rate
earned on total assets
14. Rate
earned on stockholders’ equity
15. Rate
earned on common stockholders’ equity
16. Earnings
per share on common stock
17.
Price-earnings ratio
18. Dividends
per share of common stock
19. Dividend
yield
Unit 4 Assignment: Get research paper samples and course-specific study resources under homework for you course hero writing service – Manage ment Tools
Application
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Step 1:
Practice
Complete
the AC499 Financial Report Analysis
â Rainbow
Paint Co. as practice for the Unit 4 Assignment. The solutions
for the review problem can be found here.
Step 2:
Review Ratio Sheet
Review the
AC499 Financial Report Analysis Unit 4 Ratio
Sheet.
Step
3: Financial Analysis
Complete a financial analysis of the company
financials for Quixote Consulting. Use the Excel Template titled: “Unit 4 Financial Report Analysis Template.â
Be sure to review the Excel tab titled âHints & Instructionsâ before you
attempt the Assignment tab.
Note:
This Quixote Company file will be your graded Unit 4
Assignment,notthe Rainbow CompanyPractice
Assignment.
When
you are ready, you may submit your Quixote Ratio Analysis Excel template to the
Unit 4 Dropbox page.
Note:Include
your name in the filename of the Assignment.
Very
Important Note:The Practice Set isbased on data
for âRainbow Paint Company.â Do NOTsubmit the Rainbow solutions in the
Unit 4 Assignment Dropbox.
The Unit 4 Assignment is
based on the Quixote data accumulated in Units 2 and 3. However, The Rainbow
Paint Company data will be a VITAL and integral component of your Unit 9 Final
Project. So, please complete the Practice Exercise AND keep your work saved in
a file for later use.
