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UOP ACC561 week 2 problems




Question;Week 2 Problems;BE1-5 In;alphabetical order below are balance sheet items for Mantle Company at December;31, 2010. Prepare a balance sheet following the format of Illustration 1-8.;Accounts;payable $75,000;Accounts;receivable 81,000;Cash 22,000;Common;stock 28,000;E1-4 This;information relates to Denson Co. for the year 2010.;Retained;earnings, January 1, 2010 $64,000;Advertising;expense 1,800;Dividends;paid during 2010 6,000;Rent;expense 10,400;Service;revenue 53,000;Utilities;expense 2,400;Salaries;expense 30,000;Hint: Prepare;income statement and retained earnings statement.;(SO 4);Instructions;After;analyzing the data, prepare an income statement and a retained earnings;statement for the year ending December 31, 2010.;E1-5 The following information was taken from the;2006 financial statements of pharmaceutical giant Merck and Co. All dollar;amounts are in millions;Retained;earnings, January 1, 2006 $37,980.00;Materials;and production expense 6,001.10;Marketing;and administrative expense 8,165.40;Dividends 3,318.70;Sales;revenue 22,636.00;Research;and development expense 4,782.90;Tax;expense 1,787.60;Other;revenue 2,677.10;Hint: Prepare;income statement and retained earnings statement.;(SO 4);Instructions;(a) After analyzing the data, prepare an;income statement and a retained earnings statement for the year ending December;31, 2006.;(b) Suppose that Merck decided to reduce its;research and development expense by 50%. What would be the short-term;implications? What would be the long-term implications? How do you think the;stock market would react?;(B) Immediately their net income;would increase by over 2,391,000,000.00 and that would also increase their;retained earning;Long;term however if they aren't developing for the future they won't have increased;revenue in the future;E1-9 Here;are incomplete financial statements for Garrett, Inc.;GARRETT;INC.;Balance;Sheet;Assets Liabilities and Stockholders;Equity;Cash $ 5,000 Liabilities;Inventory 10,000 Accounts payable $ 5,000;Building 45,000 Stockholders' equity;Total;assets $60,000 Common stock (a);Retained;earnings (b);Total;liabilities and stockholders' equity$60,000;Income;Statement;Revenues $85,000;Cost;of goods sold (c);Administrative;expenses 10,000;Net;income $ (d);Retained;Earnings Statement;Beginning;retained earnings $10,000;Add;Net income (e);Less;Dividends5,000;Ending;retained earnings $25,000


Paper#49301 | Written in 18-Jul-2015

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