Ch04HWSol(6th) - Chapter 4 HW Assignment: E4-3, 5, 7, 13;...

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Chapter 4 HW Assignment: E4-3, 5, 7, 13; P4-6, 9, 10, 12, 13, 22 Solutions E4-3 1. I 9. I and SE 2. SE 10. I, B, and SE 3. N 11. I 4. B 12. B and SE 5. B 13. I 6. B and SE 14. SE 7. SE 15. SE 8. I E4-5 a. Gross profit: Sales revenue $81,000 Service revenue 23,000 Rental revenue 50,000 Total revenue $154,000 Cost of goods sold 36,000 Gross profit $118,000 b. Operating expenses: General and administrative $12,000 Selling 28,000 Operating expenses $ 40,000 c. Income from operations: Gross profit $118,000 Operating expenses 40,000 Income from operations $ 78,000 d. Pretax income: Income from operations $78,000 Interest expense 7,500 Pretax income $ 70,500 e. Net income: Pretax income $70,500 Income tax expense 20,000 Net income $ 50,500 f. Earnings per share: Net income $50,500 ÷ 20,000 shares = $2.53 Chapter 4 HW Solutions Page 1
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E4-7 a. Primary source of revenue: transporting passengers. b. Percentage of revenue from transporting passengers: ($8,984 ÷ $9,744 = 0.92) 92% c. Largest expenses: Salaries and employee costs, fuel, and purchasing capacity from ExpressJet. d. Revenue from transporting passengers: $8,984,000,000 e. Revenue from other operating activities: $760,000,000 f. Nonoperating income: $178,000,000 g. Operating loss: $229,000,000 h. Nonoperating expense: $389,000,000 i. $363,000,000 loss E4-13 Marvelous Enterprises Balance Sheet April 30 Assets Current assets: Cash $ 10,360 Accounts receivable 14,700 Merchandise inventory 12,480 Supplies 3,570 Prepaid insurance 1,100 Total current assets $ 42,210 Property, plant and equipment: Land $ 45,000 Buildings 50,000 Accumulated depreciation (13,100 ) Total property, plant and equipment $ 81,900 Other assets: Copyrights and trademarks $ 5,000 Patents 3,300 Total other assets $ 8,300 Total assets $132,410 Chapter 4 HW Solutions Page 2
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Liabilities: Current liabilities: Accounts payable $ 17,000 Wages payable 17,700 Notes payable, current portion 14,200 Total current liabilities $ 48,900 Long-term liabilities: Long-term notes payable 33,000 Total liabilities $ 81,900 Stockholders’ Equity: Contributed capital $ 38,770 Retained earnings* 11,740 Total stockholders’ equity $ 50,510 Total liabilities and stockholders’ equity $132,410 *Retained earnings, March 31 + revenues – expenses – dividends = Retained earnings, April 30. = $8,400 + $26,000 – ($15,050 + $1,100 + $1,060 + $550 + $900 + $1,300 + $1,500) –
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Ch04HWSol(6th) - Chapter 4 HW Assignment: E4-3, 5, 7, 13;...

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