Question 1
Ok I will submit deadline is due tonight thanks Michael! P12-26A Journalizing stockholders equity transactions. Airborne Manufacturing Co. complete the following transactions during 2009 Jan 16- Declared a cash dividend on the 4%, $102 par preferred stock (1,050 shares outstanding) Declared a $0.55 per share dividend on the 95,000 shares of common stock outstanding. The date of record is January 31, and the payment due date is February 15. Feb15- Paid the cash dividends June 10 Split common stock 2 for 1. Before the split, airborne had 95,000 shares of $10 par common stock outstanding Jul 30 Distributed a 25% stock dividend on the common stock. The market value of the common stock was $10 per share Oct 26 Purchased 3,000 shares of treasury stock at $15 per share Nov 8 Sold 1,500 shares of treasury stock for $20 per share Nov 30 Sold 1,500 shares of treasury stock for $9 per share Requirement: Record the transactions in Airbornes general journal P12-28A Journalizing dividend and treasury stock transactions, preparing a statement of retained earnings and preparing stockholders equity. The balance sheet of Patrick Management Consulting Inc at December 31, 2011, reported the following stockholders equity: Paid-in capital: Common stock, $15 par, 300,000 shares authorized 20,000 shares issued $300,000 Paid-in capital in excess of par-common 310,000 Total paid in capital 610,000 Retained earnings 158,000 Total stockholders equity $768,000 During 2012 Patrick completed the following selected transactions: Feb6 Distributed 10% stock dividend on the common stock. The market value of Patrick?s stock was $26 per share Jul 29 Purchased 2,000 shares of treasury stock of $26 per share Nov 27 Declared $0.30 per share dividend on the 20,000 shares of common stock outstanding. The date of record in December 17 and the payment date is January 7, 2013. Dec 31 Closed the $86,000 net income to retained earnings. Requirements 1. Record the transactions in the general journal. 2. Prepare a retained earnings statement for the year ended December 31, 2012 3. Prepare the stockholders equity section of the balance sheet at December 31, 2012 P12-29A Computing EPS and reporting a retained earnings restriction The capital structure of Rodeswell Inc at December 31, 2010, included 30,000 shares of $2.00 preferred stock and 40,000 shares of common stock. Common stock outstanding during 2011 totaled 40,000 shares. Income from continuing operations during 2011 was $104,000. The company discontinued the segment of the business at a gain of $20,000 and also had an extraordinary gain of $10,000. The rodeswell board of directors restricts $98,000 of retained earnings for contingencies. Retained earnings at December 31, 2010 was $98,000 and the company declared preferred dividends of $60,000 during 2011. Requirements: 1. Compute Rodeswells earnings per share for 2011. Start with income from continuing operations. All income and loss amounts are net of income tax. 2. Show two ways of reporting Rodeswells retained earnings restriction. P12-30A Preparing a detailed income statement The following info was taken from the records of the underwood inc at sept 30, 2010 Selling expense $124,000 General expenses 131,000 Income from discontinued operations 8,000 Retained earnings, beginning 87,000 Costs of goods, sold 437,000 Treasury stock, common (1,100) shares 12,100 Net sales revenue 832,000 Common stock, $10 par 21,100 Shares authorized and issued $211,000 Preferred stock $5, no-par 3,000 shares issued 150,000 Income tax expense: Continueing operations 72,000 Income from discontinued operations 3,200 Requirement: 1. Prepare a multi step income statement for underwood inc for the fiscal year ended sept 30, 2010. Include earnings per share.
Question 2
On January 1, 2009, Mania Enterprises issued 12% bonds dated January 1, 2009, with a face amount of $20 million. The bonds mature in 2018 (10 years). For bonds of similar risk and maturity, the market yield is 10%. Interest is paid semiannually on June 30 and December 31. Required: 1. Determine the price of the bonds at January 1, 2009. 2. Prepare the journal entry to record the bond issuance by Mania on January 1, 2009. 3. Prepare the journal entry to record interest on June 30, 2009, using the effective interest method. 4. Prepare the journal entry to record interest on December 31, 2009, using the effective interest method. ********* Gore Company, organized on January 2, 2009, had pretax accounting income of $7,000,000 and taxable income of $10,000,000 for the year ended December 31, 2009. The 2009 tax rate was 40%. The only difference between book and taxable income is estimated warranty costs. Expected payments and scheduled enacted tax rates are as follows: Required: Prepare one compound journal entry to record Gore's provision for taxes for the year 2009. Please show work for bonuses!,I don't think part 1-4 are correct it appears the wrong numbers were used to start the problem in part 1.
Question 3
14-2. Camtech, which expects to start operations on January 1, 2008 will sel digital cameras in shopping malls, Camtech has budgeted sales as indicated in the following table. The company expects a 10 percent increase in sales per month for February and March. The ratio of cash sales to sales on account will remain stable from January through March. Sales January February March Cash Sales $50,000 ? ? Sales on account 80, 000 ? ? Total Budgeted sales $130,000 ? ? a. Complete the sales budget by filling in the missing amounts b. Determine the amount of sales revenue Camtech will report on its second quarter pro forma income statement. 14-7. Tucker Lighting Company sells lamps and other lighting fixtures. The purchasing department manager prepared the following inventory purchases budget. Tucker Lighting?s policy is to maintain an ending inventory balance equal to 10 percent of the following month?s cost of goods sold. April?s budgeted cost of goods sold is $85,000. January February March Budgeted cost of goods sold $70,000 $74,000 $80,000 Plus: Desired ending inventory $7,400 ? ? Inventory needed $77,400 ? ? Less: Beginning inventory $18, 000 ? ? Required purchases (on account) $59,400 ? ? a. Complete the inventory purchases budget b filling in the missing amounts b. Determine the amount of cost of goods sold the company will report on its first quarter pro forma income statement. c. Determine the amount of ending inventory the company will report on its pro forma balance sheet at the end of the first quarter. 14-13. The accountant for Lori?s Dress Shop prepared the following cash budget. Lori?s desires to maintain a cash cushion of $14,000 at the end of each month. Funds are assumed to the borrowed and repaid on the last day of each month. Interest is charged at the rate of 2 percent per month. Cash Budget July August September Section 1: Cash receipts Beginning cash balance $43,000 $ ? $ ? Add cash receipts $183,000 196,000 240,200 Total Cash available (a) 226, 000 ? ? Section 2 Cash payments For inventory purchases 163,646 139,900 172,474 S&A expenses 54,000 62,060 61,536 For interest expense 0 ? ? Total budgeted disbursements (b) 217,646 ? ? Section 3: Financing activities Surplus (shortage) $8,354 ? ? Borrowing (repayments) (c) $5,646 ? ? Ending Cash Balance (a + b + c) $14,000 $14,000 $14,000 a. Complete the cash budget by filling in the missing amounts. Round all computations to the nearest whole dollar. b. Determine the amount of net cash follows form operating activities Lori?s will report on the third quarter pro forma statement of cash flows. c. Determine the amount of net cash flows from financing activities Lori?s will report on the pro forma statement of cash flows. 14-15. Jim Denty, the controller of Grime Corporation, is trying to prepare a sales budget for the coming year. The income statements for the last four quarter follow. First Quarter Second Q. Third Q. Fourth Q. Total Sales revenue $170,000 $200,000 $210,000 $260,000 $840,000 Cost of goods sold 102,000 120,000 126,000 156,000 504,000 Gross Profit 68,000 80,000 84,000 104,000 336,000 Selling & admin, expense 17,000 20,000 21,000 26,000 84,000 Net Income $51,000 $60,000 $63,000 $78,000 $252,000 Historically, cost of goods sold is about 60 percent of sales revenue. Selling and administrative expenses are about 10 percent of sales revenue. Gene Moreno the chief executive officer told Mr. Denty that he expected sales next year to be 10 percent above last year?s level. However, Sarah Toole, the vice president of sales, told Mr. Denty that the believed sales growth would be only 5 percent. a. Prepare a pro forma income statement including quarterly budges for the coming year using Mr. Moreno?s estimate. b. Prepare a pro forma income statement including quarterly budgets for the coming year using Ms. Toole?s estimate. c. Explain why two executive officers in the same company could have different estimates of future growth.
Question 4
5-10 PowerPoint slides / can include an Excel file for financial analysis Details: Choose a public company in the food industry. Analyze the financial statements and assess whether the financial performance has improved or declined year-over-year. Analysis techniques include the following: * comparative financial statements * trend analysis * ratio analysis * percentage analysis Presentation of 5?10 PowerPoint slides that includes the following: * At least 3 slides relevant to the analysis prepared * An analysis of the performance of the firm based on the analysis tools used * A summary of the company's financial performance and assessment of whether it has improved or declined year-over-year in terms of profitability, asset utilization, and liquidity Background on Course Research Requirements: In the business world, it is important to use research to strengthen points made in presentations and projects. Learning to use the search functions in databases for research is a crucial critical thinking skill that complements other research techniques. There are two main types of databases. You must stay away from inferior Web sites with anonymous writers; articles found on consultant Web sites, and materials on Web sites that are not reputable. Dictionaries and encyclopedias most often repeat the information from textbooks. Acceptable Internet resources include, among others, government sites (especially for statistics). Wikipedia or any open source Web sites are not permitted.
Question 5
Version 1.2 The Blue Sky Software Consulting Firm Case for Management and Leadership Program Assessment The Blue Sky is a fifteen-year old software-consulting firm. It was founded by Max Blue, who was until last year its CEO and Chairman of the Board. Blue has stepped down from the CEO role, but remains Board Chairman. The new CEO is Jim Willis, who joined the company as VP for the HR software division five years ago. Before coming to Blue Sky Willis was an executive with a major accounting/consulting firm. Blue Sky is divided into three divisions: Machine Tool Software?This division develops machine tool software used in the auto industry. Some of the software is utilized by the major manufacturing companies, but mostly they serve suppliers of parts and components. HR Software- This division has developed Human Resource Management software to be used in the retail industry. Their major client has been the Best Dollar Retail Chain, which sells upscale style, but affordable clothes for teenagers. They have retail locations in most parts of the country, except for the mid Atlantic and New England states. Most of their stores are in medium to small cities. Heath Payment Software- This division has developed software for state governments to help manage their Medicaid provider payment systems. They provide this software for 15 states scattered across the country. Each division is headed by a Vice President: Machine Tool?Michael James- was one of the founders of the company, and has been with Blue Sky since the beginning as VP for Machine Tool Software. This was the first business line for Blue Sky. HR Software- Mary Garrison- she has just started with Blue Sky, and replaced Willis when he became CEO. She had previously been an Associate VP for HR Technology at Best Dollar, and was the major point of contact with them. Thus, she was very familiar with the HR software produced for Best Dollar. She was a computer science major at State University. Health Payment- Jeff Roberts has been with Blue Sky for seven years and VP of the health payment division for the last two years. Before joining Blue Sky he was a hospital administrator responsible for the hospital IT system. Page 1 of 7 The CFO is Karl Counts, who has worked in the finance department since the beginning of the company. He has been CFO for the last ten year. The newest member of the Executive team is Susy Hubres, who last year assumed the position of Director of Planning and Marketing. She graduated from Harvard?s MBA program the previous year. She was hired by Max Blue shortly before he retired as CEO. Susy is the daughter of a long-time friend of Blue. Blue Sky also has five regional offices: North, South, Central, West and East. Forty percent of the Blue Sky employees work in the regional offices. The rest work at the corporate headquarters in Cleveland Ohio. All those who work in the Machine Tool division are located in Cleveland. Three of the largest Medicaid accounts are run from the Cleveland HQ. The other health payment cli- ents are served from the regional offices. The regional offices were set up originally to serve the Best Dollar chain client. About 80% of the HR software work is performed in the various regions. Only a few centralized design functions are at the Cleveland headquarters. Each regional office has a director, who is responsible for technical output and client service in that region. Service is an important part of the business, and the regional direc- tors have all come from the service side of the business rather than the technical side. As you read the case issues below you will be asked to assume the role of a consultant who has been hired by Willis to write a critical analysis of the issues facing Blue Sky. Willis has told you he wants an honest critique and recommendations and has not indi- cated any personal preferences to you. But, Willis does want you to draw on the Man- agement literature in your report. Problems and Issues In the last few months CEO Willis has become concerned about several issues with a po- tential impact on Blue Sky. Susy Hubres is pressing him to institute a strategic planning process. Max Blue never liked to have meetings, and thought planning was a waste of time. Thus, Blue Sky never had a formal strategic plan. Susy has written a memo to Willis proposing a three-day retreat for Blue Sky executives. The main agenda for the meeting would be the development of a ten-year strategic plan. In her memo Susy relates how she took three courses in planning at Harvard, and believes she is the best person to conduct the planning retreat and process. In the memo she asks Page 2 of 7 for authority to hire two new people in her office. Both would be planning analysts, who would develop planning models using corporate and industry data. In her memo Susy cites several issues of concern. First, the decline of the American auto industry because of the current economic environment. Blue Sky has been the major source of machine tool software in the industry. Secondly, some client companies have recently cut back on contracts with Blue Sky in favor of outsourcing work to India at 20% of what they would need to pay Blue Sky for the same work Jeff Roberts, VP of the Health Payment Division, has recently informed Willis that there is an ongoing federal grand jury investigation with a focus on the Southern Regional of- fice. The U.S. Attorney is investigating allegations of illegal contributions made to the Governor as a quid pro quo for state contracts. Also, the Western regional office made a serious coding error that nearly cost Blue Sky the whole HR software line of business with Best Dollar. Mary Garrison is making the argument that more control centralization at HQ is essential for the continued viability of this division. She is proposing the closure of two of the five regional offices with a transfer of about half the professional employees in the HR software division to the Cleveland office. Garrison argues this will allow her to more personally supervise this activity. Since she has come from Best Dollar, Garrison believes she has a clear sense of their needs. Susy has concluded the HR line of business is too narrow in its focus on one client, and has suggested aggressive pursuit of new clients in the retail field. Garrison has resisted this approach with the argument that the whole HR software system is tailored for Best Dollar, and they would resist essentially sharing their HR software with competitors. If the HR software business were centralized in Cleveland, the rationale for the system of regional offices would be weakened. They were developed ten years ago specifically to serve Best Dollar whose stores are in most parts of the country. Jeff Roberts has a small R/D office in his division, and they have begun to lay the groundwork for moving to develop an information system module that might be sold to hospitals as part of the move toward electronic medical records. The CFO claims the pursuit of this strategy would take a significant technical and financial investment to de- velop and sell such a product. He does not think the company has the financial resources to do this, and fears the taking on of substantial debt to pursue this project is very risky. Historically not only has the level of autonomy of the regions been an issue, but there is also the question of how they should be involved in decision-making. Page 3 of 7 Decision-making Max Blue was a very talented software engineer, who personally led the effort to develop the three main software programs, which are the main competitive advantage of Blue Sky. Even his greatest admirers would admit that Max was an autocrat. Mostly a be- nevolent autocrat, but as he often said, ?This is my company, and I know best how to run it.? Health problems have slowed down his level of physical activity so Willis thinks Max will live up to the promise to stay out of operations that he made when he offered the CEO position to Willis. But, Max?s autocratic nature has led to a somewhat passive culture in which most key participants tend to wait for the ?boss? to give orders. Suzy has been somewhat outspo- ken in her critique of this culture. But, everyone gets along well, and there are few of the personal battles that poison the atmosphere in some companies. The regional directors are all younger and have been with Blue Sky a relatively short time. They started with Blue Sky in the sales and customer service part of the business, and have less technical knowledge. They would like to be more aggressive by expanding the business by seeking new clients and new product lines. The directors have typically only been involved in the Executive team meetings when there is a specific issue related to the regional offices. Willis has wondered if the dynamics of the decision process for the Executive Team would be enhanced if the regional directors were more systematically involved. Willis is by nature more collaborative than autocratic. He has experimented with a more collaborative decision-making process in his weekly meetings with the VPs. As a group they do not seem to have a facility to come to a consensus decision. After a period of dis- cussion, they seem to look to Willis to make a decision. Since the company has been successful most of the executives and employees who have been with Blue Sky for a while are financially well off. Many of these older employees seem to be coasting toward retirement, and are not very interested in company expansion, especially if this carries some risk. Much of their retirement fund is tied to Blue Sky. Thus, the older generation tends to be satisfied with Blue Sky as it has been. They are mostly risk averse on new initiatives. A Major Decision An example of the recent decision-making process at Blue Sky is found in their dealing with product pricing in the Machine Tool Division. CFO Counts initiated this discussion in the Executive Team by presenting a report showing steady downward trend in the net revenue for this division. Gross revenue has over the last five years increased about 1% Page 4 of 7 per year on average, but expenses have increased an average of 5% per year. If this trend continues for three more years, the division will no longer be profitable. Willis scheduled a special meeting for this to be discussed by the Executive Team. At the meeting James stated the problem was a decision a few years ago to head off further de- cline in the volume of business by holding the line on charges for the product. The threat is the aggressive behavior of Indian software companies in seeking the business. This de- cision was made by Blue and James with little consultation of the others. James reminded the team that the level pricing approach was intended to last only a year or so. He thinks that it is now time to raise charges again. Counts responded by pointing out that the rise in expenditures is caused by the hiring of several new high salary people in the Machine Tool Division. Hubres replied by pointing out American automakers and their suppliers are the main clients, and now those companies are in serious decline. She believes the problems are structural in the industry, and that not the India software com- panies are the real long-term problem. Garrison and Roberts take the attitude ?this is not my division or my problem?. The Japanese and other automakers in the US tend to use their own internal software prod- ucts, and thus James has never pursued contracts with them. Counts has urged Willis to lay off some of the employees in the division since business has not been growing. He believes too many new people were hired in the last couple of years. Hubres wrote a ?planning memo? arguing the division should be more aggressive in developing both new clients for the current software product, and new products for other clients. James has argued that Counts has too much of an accounting perspective and doesn?t un- derstand the difficulty of maintaining complex software??this is not just an Excel finan- cial model?, and that Harvard didn?t teach Hubres about the importance of personal rela- tionships as a key to business development. Willis held two all morning meetings on the topic, and hoped the group would develop a consensus. But, mostly there was a restating of everyone?s position. Even after Willis talked individually with Garrison and Roberts, they were reluctant to personally intervene in the dispute. Willis concluded they feared other VPs might try to micromanage their divisions in the future if they set a precedent. Willis tended to agree with the perspective expressed by Hubres, but thought the only way he could get the division to move aggressively with new software or new customers was to fire James and replace him with someone new. Blue would almost certainly not be happy about such an action because James was personally an old friend and co- founder of the company. Page 5 of 7 It was clear the others looked to Willis to solve the problem, and most of the participants thought he would side with them. Willis ultimately talked to James, and convinced him to work with Counts on a special retirement package for a few senior employees in the division without any immediate re- placement for the retirees. This would save some money for the division.? He had a meeting with James and Hubres and convinced them to work together to hire a management consultant who would suggest possible approaches to finding new clients for the current software. Willis felt he had averted a large-scale conflict within the organization, but continued to worry this was a small temporary adjustment in response to a larger problem. Case Questions and Instructions (to students) Assume you are a consultant reporting to Willis, who charged you to examine the management issues facing Blue Sky Software. Based on your total classwork in the Management and Leadership program write a critical analysis. Focus on what you find to be the critical elements facing the company. Be sure to identify and analyze the management issues facing the Blue Sky Company, and in your essay include relevant conceptual ideas. Some questions to consider are: (but the essay need not be limited to these ques- tions) 1. Blue Sky has undergone a leadership change. Be sure to address the differences in leadership style and approach today and in the recent past at Blue Sky. 2. For every organization motivation is a critical element. Be sure to discuss and evaluate the approaches to motivation at Blue Sky now and in the past. 3. Has strategic planning and decision-making changed at Blue Sky? If so, is this a positive change? 4. The structure of an organization and its control systems are design elements. Identify potential design and/or control problems at Blue Sky and discuss appli- cable principles and theories of management that address these problems. Page 6 of 7 In your essay be sure to explicitly rely on management principles, concepts and theories from all the management courses to organize your response. The goal is to demonstrate understanding, application, and integration by the case essay. There is no single solution, and the essay should not just be a set of personal opinions."
