财务会计exercies.doc

1. Baesd on income statement, balance sheet and cash flow statement of FUTURE! Brands, Inc. and other information, shown as followings: (48 scores)
(1) Translate 3 cash flow statement items into Chinese: (6 scores)
① Purchases of property, plant, and equipment
② Payment of dividends and other distributions to stockholders
③ Net Increase in cash and cash Equivalents
(2)Calculate required financial indicators on Dec. 31, 2011: (20 scores)
① Current ratio=
② Quick ratio=
③ Debt-to-equity=
④ long-term debt-to equity=
⑤ Times-interest-earned=
⑥ Gross profit percentage=
⑦ Inventory turnover=
⑻ Days inventory held=
⑨ Receivable turnover=
⑩ Days receivable=
FUTURE! Brands, Inc. Statement of Income for the Years
Ended Dec. 31, 2011 and 2010
(In millions) 2011 2010
Revenues
Company sales ＄9,365 ＄9,225
Franchise and license fees 196 124
Total revenues 9,561 9,349
Expenses
Cost of goods sold 2,249 2,284
Payroll and employee benefits expense 2,442 2,471
Occupancy and other operating expenses 2403 2,315
General and administrative expenses 1,187 1,158
Other operating expenses (income) 18 (32)
Total expenses 8,229 8,196
Operating profit 1,262 1,153
Interest expense 154 127
Income before income taxes 1,108 1,026
Income tax expense 284 264
Net income ＄ 824 ＄ 762

FUTURE! Brands, Inc. Balance (Adapted) December 31, 2011,and 2010
(In millions) 2011 2010

ASSETS
Current Assets
Cash and cash equivalents…………………… ＄310 ＄150
Short-term investments…………………………… 15 51
Accounts and note receivable………………… 220 236
Inventories……………………………………… 93 85
Prepaid expenses and other current assets… 263 333
Total Current Assets………………………… 901 855
Property, plant and equipment, at cost. 6,777 ＄6,186
Less: Accumulated depreciation………….. (3,146) (2,830)
Property, plant and equipment, net………… 3,631 3,356
Intangible assets…………………………… 1,009 868
Investments…………………………… .. 138 173
Other assets………………………………… 674 545
Total Assets…………………………… ＄6,353 ＄ 5,797
LIABILITIES
Current Liabilities
Accounts payable………………………… . ＄554 ＄473
Income taxes payable…………………… 37 79
Short-term borrowings (Notes payable)……… 22 211
Salaries and wages payable………………… 302 274
Other current liabilities………………………… 604 586
Total Current Liabilities……………… 1,724 1,623
Long-term debt…………………………… 2,045 1,649
Other long-term liabilities……………………… 1,147 1,076
Total Liabilities……………………………… 4,916 4,348
SHAREHOLDERS’ EQUITY
Common stock…………………………… 23 20
Paid-in capital 12 14
Treasury stock (8) (6)
Retained earnings…………………… 1,593 1,619
Other equity………………………………. (183) (198)
Total Shareholders’ Equity………… 1,437 1,449
Total Liabilities and Shareholders’ Equity ＄6353 ＄5,797

FUTURE! Brands, Inc.
Statement of Cash Flows (Adapted)
Years Ended December 31, 2011,and 2010
(In millions) 2011 2010

Cash Flows---Operating Activities
Net income ………………………………… . ＄ 824 ＄762
Adjustments to reconcile net income to net cash
Provided by operating activities …………… 478 476
Net Cash Provided by Operating Activities 1,302 1,238
Cash Flows---Investing Activities
Purchases of property, plant, and equipment….. (614) (609)
Sales of property, plant, and equipment… 57 81
Other ………………………………………. 81 183
Net Cash Used in Investing Activities… (476) (345)
Cash Flows---Financing Activities
Issuance of common stock……………… — —
Issuance of short-term and long-term debt
(Borrowing)……………………………… 540 160
Repayments of short-term and long-term debt (288) (48)
Payment of dividends and other distributions
to stockholders………………………… (850) (210)
Other payments…………………… (67) (733)
Net Cash Used in Financing Activities… (665) (831)
Net Increase in cash and cash Equivalents……. 161 62
Cash and Cash Equivalents---Beginning of Year 158 96
Cash and Cash Equivalents---End of Year…… ＄ 319 ＄ 158
(3) Supposed, the numbers of common stock are 110,134,256 and 110,026,782 shares for Dec. 31, 2011 and Dec. 31, 2010 respectively. The numbers of treasury stock on Dec. 31, 2011 and Dec. 31, 2010 are 200,000 and 195,000 shares respectively. The closing price of common stock is $15.25 per share and on Dec. 31, 2011, and $11.25 per share on Dec. 31, 2010, and there is no cash dividends distribution from Dec. 31, 2010 to Dec. 31, 2011. Calculate required financial indicators on Dec. 31, 2011: (10 scores)

Market-to-book ratio=
Accounting return on equity=
Economic return on equity=
(4) Point out the asset items classified into BvA1 and BvA3. (8 scores)
BvA1 items：
BvA3 items：
(5) Do the balance sheet and income statement of FUTURE! Brands, Inc give a clear or cloudy picture of its activities? (4 scores)

2. Make ordinary accounting entries and adjustment accounting entries and/or closing accounting entries at ending date of 2011, if any. (52 scores)
1.Bob and Betsy decided to incorporate Wesell Inc. They became two owners of Wesell Inc. by each contributing $700,000 cash to the business on January 1, 2011. (2 scores)
2.Bob and Betsy decided Wesell will borrow some money. On January 2, 2011, Wesell opted to issue bonds and received $00,000 cash, the bonds pay 6% interest annually (On January 2 of each year) and fall due on January 2, 2020. (4 scores)
3.On January 3, 2011, Wesell bought computers and office equipment for $30,000. The expected useful life is 5 years, and expected net salvage value is $5 000, using duble-balance-declining depreciation method. (4 scores)
4.On January 4, 2011, Wesell purchased $3,000 of supplies on credit. An physical count for them under FIFO method found that the supplies was only $400 left. (4 scores)
5. On January 2, 2011, Wesell paid $1,400 of the account payable. (2 scores)
6. On January 1, 2011, Websell paid $66,000 cash to acquire the rights to various software programs, which expected last 4 years. (4 scores)
7. On January 1, 2011, Websell paid $280,000 cash for the rights to copyrighted materials, being expected to be useful for the next 5 years. (4 scores)
8. On February 5, 2011, Websell completed a consulting engagement for the client and billed the client for $3,200. (2 scores)
9. On April 31, 2011, Websell paid developers for its web site $1,200,000 for programming and design service, which expected last 4 years. (4 scores)
10. On April 1, 2011, Websell entered into the agreement to provide internet consulting services to a major corporation. The agreement called for Websell to receive immediately $75,000. (2 scores)
11. On May 15, 2011, Websell completed the above consulting job. In addiction to earning the entire $45,000 it received in advance, Websell billed the client additional $55,000 for the job. (3 scores)
12. During the six-month period to June 30, 2011, Websell paid wages of 47,000. (2 scores)
13. Websell collected $41,000 of its accounts receivable during the six-month period to Dec 31, 2011. (2 scores)
14. Received payment of $700 000 from Bone Inc. for the sale of goods on June 8. (2 scores)
15. Paid advertisement expenses for cash $500. (4 scores)
16. Prepare closing entries (10 scores)