Lashae Gayden Essentials in accounting Homework assignment Week 1 Chapter 1: E1-3, P1-3A The Long Run Golf & Country Club details the following accounts in its financial statements. Instructions * (a)Classify each of the above accounts as an asset (A), liability (L), stockholders’ equity (SE), revenue (R), or expense (E) item. * (b)Classify each of the above accounts as a financing activity (F), investing activity (I), or operating activity (O).If you believe a particular account doesn’t fit in any of these activities, explain why.
Asset| Liability| Stock holder equity| Revenue| Expense| Accounts receivable| Accounts payable and accrued – liabilities| Long-term debt| Food and beverage operations revenue| Office and general expense| Property, plant, and equipment| Long-term debt| | Golf course operations revenue| Professional fees expense| Inventory| Wages and benefits expense| | | Wages and benefits expense| | | |Financing Activity| Investing Activity| Operating Activity| Accounts payable and accrued – liabilities| Property, plant, and equipment| Food and beverage operations revenue| Long-term debt| Inventory| Golf course operations revenue| Office and general expense| Professional fees expense| | | | | | | | | | | P1-3A On June 1 Eckersley Service Co. was started with an initial investment in the company of $26,200 cash. Here are the assets and liabilities of the company at June 30, and the revenues and expenses for the month of June, its first onth of operations: Cash| 4,600| Notes payable| 12,000| Accounts receivable| 4,000| Accounts payable| 500| Revenue| 7,000| Supplies expense| 1,000| Supplies| 2,400| Gas and oil expense| 600| Advertising expense| 400| Utilities expense| 300| Equipment| 29,000| Wage expense| 1,400| | | | | Revenues| $46,000| | | Total revenue| $46,000| | | Expenses| | | | Advertising| 400| | | Gas and oil expense| 600| | | Notes payable| 12,000| | | Accounts payable | 500| | | Salaries and wages| 1400| | | Supplies| 2,400| | | Utilities Expenses| 300| | |Dividends| 2,000| | | Total expenses| 19,600| | | Net Income| $26,400| | | Chapter 2: E2-1, P2-4A E2-1. Instructions Classify each of the following financial statement items taken from Remington Corporation’s balance sheet. * CL-Accounts payable and accrued liabilities * CA- Accounts receivable * PPE-Accumulated depreciation * PPE -Buildings * CA -Cash and short-term investments * CL-Dividends payable * IA-Goodwill * C L -Income taxes payable * CA Inventories * CA- Investments * PPE -Land * CL-Long-term debt * PPE -Materials and supplies * PPE-Office equipment and furniture CA – Prepaid expenses P2-4A Instructions: * (a)Comment on the relative profitability of the companies by computing the net income and earnings per share for each company for 2010. $532,000/100,000=53.
20 shares * (b)Comment on the relative liquidity of the companies by computing working capital and the current ratios for each company for 2010. Current Ration = 407,20066,325= 6. 14:1 of relative liquidity for Bedene Corporation- means that for every dollar of current liabilities, Bedene Corporation has $6. 14 of current assets.
Current Ration = 190,33640,348= 4. 1 of relative liquidity for Groneman Corporation- meansthat for every dollar of current liabilities, Groneman Corporation has $4. 71 of current assets * (c)Comment on the relative solvency of the companies by computing the debt to total assets ratio and the free cash flow for each company for 2010. 174,825532,00=33% debt to total ratio for Bedene Corporation means that every dollar of assets was financed by 33 cents of debt. 69,968139,728=50% debt to total ratio for Groneman Corporation means that every dollar of assets was financed by 50 cents of debt.