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Question 1)
The company’s complete annual report, including the notes to its financial statements, is available in the Investor Relations section at www.zetarplc.com.
Visit Zetar’s corporate website and answer the following questions from Zetar’s 2011 annual report.
What is the approximate tax rate of Zetar’s “Tax on profit from continuing activities”? (Round answer to 0 decimal places, e.g. 25%.)
Zetar’s tax rate is approximately %
Question 2)
The financial statements of The Hershey Company and Tootsie Roll are presented below.
THE HERSHEY COMPANYCONSOLIDATED STATEMENTS OF INCOME
For the years ended December 31, 2011 2010 2009In thousands of dollars except per share amountsNet Sales $6,080,788 $5,671,009 $5,298,668Costs and Expenses: Cost of sales 3,548,896 3,255,801 3,245,531 Selling, marketing and administrative 1,477,750 1,426,477 1,208,672 Business realignment and impairment (credits) charges, net
(886) 83,433 82,875
Total costs and expenses 5,025,760 4,765,711 4,537,078Income before Interest and Income Taxes 1,055,028 905,298 761,590 Interest expense, net 92,183 96,434 90,459Income before Income Taxes 962,845 808,864 671,131 Provision for income taxes 333,883 299,065 235,137Net Income $628,962 $509,799 $435,994
Net Income Per Share—Basic—Class B Common Stock
$2.58 $2.08 $1.77
Net Income Per Share—Diluted—Class B Common Stock
$2.56 $2.07 $1.77
Net Income Per Share—Basic—Common Stock $2.85 $2.29 $1.97
Net Income Per Share—Diluted—Common Stock $2.74 $2.21 $1.90
Cash Dividends Paid Per Share: Common Stock $1.3800 $1.2800 $1.1900 Class B Common Stock 1.2500 1.1600 1.0712The notes to consolidated financial statements are an integral part of these statements and are included in the Hershey's 2011 Annual Report, available at www.thehersheycompany.com.
THE HERSHEY COMPANYCONSOLIDATED BALANCE SHEETS
December 31, 2011 2010In thousands of dollars
ASSETSCurrent Assets: Cash and cash equivalents $693,686 $884,642 Accounts receivable—trade 399,499 390,061 Inventories 648,953 533,622 Deferred income taxes 136,861 55,760 Prepaid expenses and other 167,559 141,132 Total current assets 2,046,558 2,005,217Property, Plant and Equipment, Net 1,559,717 1,437,702Goodwill 516,745 524,134Other Intangibles 111,913 123,080Deferred Income Taxes 38,544 21,387Other Assets 138,722 161,212 Total assets $4,412,199 $4,272,732
LIABILITIES AND STOCKHOLDERS’ EQUITYCurrent Liabilities: Accounts payable $420,017 $410,655 Accrued liabilities 612,186 593,308 Accrued income taxes 1,899 9,402 Short-term debt 42,080 24,088 Current portion of long-term debt 97,593 261,392 Total current liabilities 1,173,775 1,298,845Long-term Debt 1,748,500 1,541,825Other Long-term Liabilities 617,276 494,461 Total liabilities 3,539,551 3,335,131Commitments and Contingencies — —Stockholders’ Equity: The Hershey Company Stockholders’ Equity Preferred Stock, shares issued: none in 2011 and 2010 — — Common Stock, shares issued: 299,269,702 in 2011 and 299,195,325 in 2010
299,269 299,195
Class B Common Stock, shares issued: 60,632,042 in 2011 and 60,706,419 in 2010
60,632 60,706
Additional paid-in capital 490,817 434,865 Retained earnings 4,699,597 4,374,718 Treasury—Common Stock shares, at cost: 134,695,826 in 2011 and 132,871,512 in 2010
(4,258,962) (4,052,101)
Accumulated other comprehensive loss (442,331) (215,067) The Hershey Company stockholders’ equity 849,022 902,316 Noncontrolling interests in subsidiaries 23,626 35,285 Total stockholders’ equity 872,648 937,601 Total liabilities and stockholders’equity $4,412,199 $4,272,732
THE HERSHEY COMPANYCONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended December 31, 2011 2010 2009In thousands of dollarsCash Flows Provided from (Used by) Operating ActivitiesNet income $628,962 $509,799 $435,994Adjustments to reconcile net income to net cash provided from operations:Depreciation and amortization 215,763 197,116 182,411Stock-based compensation expense, net of tax of $15,127, $17,413 and $19,223, respectively
28,341 32,055 34,927
Excess tax benefits from stock-based compensation (13,997) (1,385) (4,455)
Deferred income taxes 33,611 (18,654) (40,578)Gain on sale of trademark licensing rights, net of tax of $5,962
(11,072) — —
Business realignment and impairment charges, net of tax of $18,333, $20,635 and $38,308, respectively
30,838 77,935 60,823
Contributions to pension plans (8,861) (6,073) (54,457)Changes in assets and liabilities, net of effects from business acquisitions and divestitures:Accounts receivable—trade (9,438) 20,329 46,584Inventories (115,331) (13,910) 74,000Accounts payable 7,860 90,434 37,228Other assets and liabilities (205,809) 13,777 293,272
Net Cash Provided from Operating Activities 580,867 901,423 1,065,749Cash Flows Provided from (Used by) Investing ActivitiesCapital additions (323,961) (179,538) (126,324)Capitalized software additions (23,606) (21,949) (19,146)Proceeds from sales of property, plant and equipment 312 2,201 10,364Proceeds from sales of trademark licensing rights 20,000 — —Business acquisitions (5,750) — (15,220)
Net Cash (Used by) Investing Activities (333,005) (199,286) (150,326)Cash Flows Provided from (Used by) Financing ActivitiesNet change in short-term borrowings 10,834 1,156 (458,047)Long-term borrowings 249,126 348,208 —Repayment of long-term debt (256,189) (71,548) (8,252)Proceeds from lease financing agreement 47,601 — —Cash dividends paid (304,083) (283,434) (263,403)Exercise of stock options 184,411 92,033 28,318Excess tax benefits from stock-based compensation 13,997 1,385 4,455Contributions from noncontrolling interests in subsidiaries — 10,199 7,322Repurchase of Common Stock (384,515) (169,099) (9,314)
Net Cash (Used by) Financing Activities (438,818) (71,100) (698,921)(Decrease) Increase in Cash and Cash Equivalents (190,956) 631,037 216,502Cash and Cash Equivalents as of January 1 884,642 253,605 37,103Cash and Cash Equivalents as of December 31 $693,686 $884,642 $253,605
Interest Paid $97,892 $97,932 $91,623Income Taxes Paid 292,315 350,948 252,230
TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF
Earnings, Comprehensive Earnings and Retained Earnings (in thousands except per share data)
For the year ended December 31,2011 2010 2009
Net product sales $528,369 $517,149 $495,592Rental and royalty revenue 4,136 4,299 3,739Total revenue 532,505 521,448 499,331Product cost of goods sold 365,225 349,334 319,775Rental and royalty cost 1,038 1,088 852Total costs 366,263 350,422 320,627Product gross margin 163,144 167,815 175,817Rental and royalty gross margin 3,098 3,211 2,887Total gross margin 166,242 171,026 178,704Selling, marketing and administrative expenses 108,276 106,316 103,755Impairment charges — — 14,000
Earnings from operations 57,966 64,710 60,949Other income (expense), net 2,946 8,358 2,100Earnings before income taxes 60,912 73,068 63,049Provision for income taxes 16,974 20,005 9,892Net earnings $43,938 $53,063 $53,157
Net earnings $43,938 $53,063 $53,157Other comprehensive earnings (loss) (8,740) 1,183 2,845Comprehensive earnings $35,198 $54,246 $56,002
Retained earnings at beginning of year. $135,866 $147,687 $144,949Net earnings 43,938 53,063 53,157Cash dividends (18,360) (18,078) (17,790)Stock dividends (47,175) (46,806) (32,629)Retained earnings at end of year $114,269 $135,866 $147,687
Earnings per share $0.76 $0.90 $0.89
Average Common and Class B Common shares outstanding 57,892 58,685 59,425(The accompanying notes are an integral part of these statements.)
CONSOLIDATED STATEMENTS OFFinancial Position
TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIES (in thousands except per share data)Assets December 31,
2011 2010CURRENT ASSETS:Cash and cash equivalents $78,612 $115,976Investments 10,895 7,996Accounts receivable trade, less allowances of $1,731 and $1,531 41,895 37,394Other receivables 3,391 9,961Inventories:Finished goods and work-in-process 42,676 35,416Raw materials and supplies 29,084 21,236Prepaid expenses 5,070 6,499Deferred income taxes 578 689Total current assets 212,201 235,167
PROPERTY, PLANT AND EQUIPMENT, at cost:Land 21,939 21,696Buildings 107,567 102,934Machinery and equipment 322,993 307,178Construction in progress 2,598 9,243
455,097 440,974Less—Accumulated depreciation 242,935 225,482Net property, plant and equipment 212,162 215,492
OTHER ASSETS:Goodwill 73,237 73,237Trademarks 175,024 175,024Investments 96,161 64,461Split dollar officer life insurance 74,209 74,441Prepaid expenses 3,212 6,680Equity method investment 3,935 4,254Deferred income taxes 7,715 9,203Total other assets 433,493 407,300Total assets $857,856 $857,959
Liabilities and Shareholders’ Equity December 31,2011 2010
CURRENT LIABILITIES:Accounts payable $10,683 $9,791Dividends payable 4,603 4,529Accrued liabilities 43,069 44,185Total current liabilities 58,355 58,505
NONCURRENT LIABILITES:Deferred income taxes 43,521 47,865Postretirement health care and life insurance benefits 26,108 20,689Industrial development bonds 7,500 7,500Liability for uncertain tax positions 8,345 9,835Deferred compensation and other liabilities 48,092 46,157Total noncurrent liabilities 133,566 132,046
SHAREHOLDERS’ EQUITY:Common stock, $.69-4/9 par value—120,000 shares authorized—36,479 and 36,057 respectively, issued
25,333 25,040
Class B common stock, $.69-4/9 par value—40,000 shares authorized—21,025 and 20,466 respectively, issued
14,601 14,212
Capital in excess of par value 533,677 505,495Retained earnings, per accompanying statement 114,269 135,866Accumulated other comprehensive loss (19,953) (11,213)Treasury stock (at cost)—71 shares and 69 shares, respectively (1,992) (1,992)Total shareholders’ equity 665,935 667,408Total liabilities and shareholders’ equity $857,856 $857,959
TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF
Cash Flows (in thousands)For the year ended December
31,2011 2010 2009
CASH FLOWS FROM OPERATING ACTIVITIES: Net earnings $43,938 $53,063 $53,157 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation 19,229 18,279 17,862 Impairment charges — — 14,000 Impairment of equity method investment — — 4,400 Loss from equity method investment 194 342 233 Amortization of marketable security premiums 1,267 522 320 Changes in operating assets and liabilities: Accounts receivable (5,448) 717 (5,899) Other receivables 3,963 (2,373) (2,088) Inventories (15,631) (1,447) 455 Prepaid expenses and other assets 5,106 4,936 5,203 Accounts payable and accrued liabilities 84 2,180 (2,755) Income taxes payable and deferred (5,772) 2,322 (12,543) Postretirement health care and life insurance benefits 2,022 1,429 1,384 Deferred compensation and other liabilities 2,146 2,525 2,960 Others (708) 310 305 Net cash provided by operating activities 50,390 82,805 76,994CASH FLOWS FROM INVESTING ACTIVITIES: Capital expenditures (16,351) (12,813) (20,831) Net purchase of trading securities (3,234) (2,902) (1,713) Purchase of available for sale securities (39,252) (9,301) (11,331)
Sale and maturity of available for sale securities 7,680 8,208 17,511 Net cash used in investing activities (51,157) (16,808) (16,364) CASH FLOWS FROM FINANCING ACTIVITIES: Shares repurchased and retired (18,190) (22,881) (20,723) Dividends paid in cash (18,407) (18,130) (17,825) Net cash used in financing activities (36,597) (41,011) (38,548)
Increase (decrease) in cash and cash equivalents (37,364) 24,986 22,082
Cash and cash equivalents at beginning of year 115,976 90,990 68,908Cash and cash equivalents at end of year $78,612 $115,976 $90,990
Supplemental cash flow information Income taxes paid $16,906 $20,586 $22,364 Interest paid $38 $49 $182 Stock dividend issued $47,053 $46,683 $32,538
(The accompanying notes are an integral part of these statements.)
Based on the information contained in these financial statements, determine the following values for each company. (Round all percentages to 1 decimal places, e.g. 17.5%, and all other answers to thousands.)
(1) Profit margin for 2011. (For Tootsie Roll, use “Total Revenue.”)
Profit margin ratio
Tootsie Roll %
Hershey Company
%
(2) Gross profit for 2011. (For Tootsie Roll, use “Product” amounts.)
Gross profit (000’s)
Tootsie Roll $
Hershey Company $
(3) Gross profit rate for 2011. (For Tootsie Roll, use “Product” amounts.)
Gross profit rate
Tootsie Roll %
Hershey Company
%
(4) Operating income for 2011.
Operating income (000's)
Tootsie Roll $
Hershey Company $
(5) Percentage change in operating income from 2011 to 2010. (Show decrease with either a negative sign, e.g. -15.2% or in parentheses, e.g. (15.2)%.)
Percent change in
operating income
Tootsie Roll %
Hershey Company
%
Question 3)
Gerish Company buys merchandise on account from Mangus Company. The selling price of the goods is $1,489 and the cost of the goods sold is $616. Both companies use perpetual inventory systems.
Journalize the transactions on the books of both companies. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)
Question 4)
Account Titles and Explanation
Debit Credit
Gerish Company
Mangus Company
(To record sale of merchandise)
The financial statements of The Hershey Company and Tootsie Roll are presented below.
THE HERSHEY COMPANYCONSOLIDATED STATEMENTS OF INCOME
For the years ended December 31, 2011 2010 2009In thousands of dollars except per share amountsNet Sales $6,080,788 $5,671,009 $5,298,668Costs and Expenses: Cost of sales 3,548,896 3,255,801 3,245,531 Selling, marketing and administrative 1,477,750 1,426,477 1,208,672 Business realignment and impairment (credits) charges, net
(886) 83,433 82,875
Total costs and expenses 5,025,760 4,765,711 4,537,078Income before Interest and Income Taxes 1,055,028 905,298 761,590 Interest expense, net 92,183 96,434 90,459Income before Income Taxes 962,845 808,864 671,131 Provision for income taxes 333,883 299,065 235,137Net Income $628,962 $509,799 $435,994
Net Income Per Share—Basic—Class B Common Stock
$2.58 $2.08 $1.77
Net Income Per Share—Diluted—Class B Common Stock
$2.56 $2.07 $1.77
Net Income Per Share—Basic—Common Stock $2.85 $2.29 $1.97
Net Income Per Share—Diluted—Common Stock $2.74 $2.21 $1.90
Cash Dividends Paid Per Share: Common Stock $1.3800 $1.2800 $1.1900 Class B Common Stock 1.2500 1.1600 1.0712The notes to consolidated financial statements are an integral part of these statements and are included in the Hershey's 2011 Annual Report, available at www.thehersheycompany.com.
THE HERSHEY COMPANYCONSOLIDATED BALANCE SHEETS
December 31, 2011 2010In thousands of dollarsASSETSCurrent Assets: Cash and cash equivalents $693,686 $884,642 Accounts receivable—trade 399,499 390,061 Inventories 648,953 533,622 Deferred income taxes 136,861 55,760 Prepaid expenses and other 167,559 141,132 Total current assets 2,046,558 2,005,217Property, Plant and Equipment, Net 1,559,717 1,437,702Goodwill 516,745 524,134Other Intangibles 111,913 123,080Deferred Income Taxes 38,544 21,387Other Assets 138,722 161,212 Total assets $4,412,199 $4,272,732
LIABILITIES AND STOCKHOLDERS’ EQUITYCurrent Liabilities: Accounts payable $420,017 $410,655 Accrued liabilities 612,186 593,308 Accrued income taxes 1,899 9,402 Short-term debt 42,080 24,088 Current portion of long-term debt 97,593 261,392
Total current liabilities 1,173,775 1,298,845Long-term Debt 1,748,500 1,541,825Other Long-term Liabilities 617,276 494,461 Total liabilities 3,539,551 3,335,131Commitments and Contingencies — —Stockholders’ Equity: The Hershey Company Stockholders’ Equity Preferred Stock, shares issued: none in 2011 and 2010 — — Common Stock, shares issued: 299,269,702 in 2011 and 299,195,325 in 2010
299,269 299,195
Class B Common Stock, shares issued: 60,632,042 in 2011 and 60,706,419 in 2010
60,632 60,706
Additional paid-in capital 490,817 434,865 Retained earnings 4,699,597 4,374,718 Treasury—Common Stock shares, at cost: 134,695,826 in 2011 and 132,871,512 in 2010
(4,258,962) (4,052,101)
Accumulated other comprehensive loss (442,331) (215,067) The Hershey Company stockholders’ equity 849,022 902,316 Noncontrolling interests in subsidiaries 23,626 35,285 Total stockholders’ equity 872,648 937,601 Total liabilities and stockholders’equity $4,412,199 $4,272,732
THE HERSHEY COMPANYCONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended December 31, 2011 2010 2009In thousands of dollarsCash Flows Provided from (Used by) Operating ActivitiesNet income $628,962 $509,799 $435,994Adjustments to reconcile net income to net cash provided from operations:Depreciation and amortization 215,763 197,116 182,411Stock-based compensation expense, net of tax of $15,127, $17,413 and $19,223, respectively
28,341 32,055 34,927
Excess tax benefits from stock-based compensation (13,997) (1,385) (4,455)Deferred income taxes 33,611 (18,654) (40,578)Gain on sale of trademark licensing rights, net of tax of $5,962
(11,072) — —
Business realignment and impairment charges, net of tax of $18,333, $20,635 and $38,308, respectively
30,838 77,935 60,823
Contributions to pension plans (8,861) (6,073) (54,457)Changes in assets and liabilities, net of effects from business acquisitions and divestitures:Accounts receivable—trade (9,438) 20,329 46,584Inventories (115,331) (13,910) 74,000Accounts payable 7,860 90,434 37,228Other assets and liabilities (205,809) 13,777 293,272
Net Cash Provided from Operating Activities 580,867 901,423 1,065,749Cash Flows Provided from (Used by) Investing ActivitiesCapital additions (323,961) (179,538) (126,324)Capitalized software additions (23,606) (21,949) (19,146)Proceeds from sales of property, plant and equipment 312 2,201 10,364Proceeds from sales of trademark licensing rights 20,000 — —Business acquisitions (5,750) — (15,220)
Net Cash (Used by) Investing Activities (333,005) (199,286) (150,326)Cash Flows Provided from (Used by) Financing
ActivitiesNet change in short-term borrowings 10,834 1,156 (458,047)Long-term borrowings 249,126 348,208 —Repayment of long-term debt (256,189) (71,548) (8,252)Proceeds from lease financing agreement 47,601 — —Cash dividends paid (304,083) (283,434) (263,403)Exercise of stock options 184,411 92,033 28,318Excess tax benefits from stock-based compensation 13,997 1,385 4,455Contributions from noncontrolling interests in subsidiaries — 10,199 7,322Repurchase of Common Stock (384,515) (169,099) (9,314)
Net Cash (Used by) Financing Activities (438,818) (71,100) (698,921)(Decrease) Increase in Cash and Cash Equivalents (190,956) 631,037 216,502Cash and Cash Equivalents as of January 1 884,642 253,605 37,103Cash and Cash Equivalents as of December 31 $693,686 $884,642 $253,605
Interest Paid $97,892 $97,932 $91,623Income Taxes Paid 292,315 350,948 252,230
TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF
Earnings, Comprehensive Earnings and Retained Earnings (in thousands except per share data)
For the year ended December 31,2011 2010 2009
Net product sales $528,369 $517,149 $495,592Rental and royalty revenue 4,136 4,299 3,739Total revenue 532,505 521,448 499,331Product cost of goods sold 365,225 349,334 319,775Rental and royalty cost 1,038 1,088 852Total costs 366,263 350,422 320,627Product gross margin 163,144 167,815 175,817Rental and royalty gross margin 3,098 3,211 2,887Total gross margin 166,242 171,026 178,704Selling, marketing and administrative expenses 108,276 106,316 103,755Impairment charges — — 14,000Earnings from operations 57,966 64,710 60,949Other income (expense), net 2,946 8,358 2,100Earnings before income taxes 60,912 73,068 63,049Provision for income taxes 16,974 20,005 9,892Net earnings $43,938 $53,063 $53,157
Net earnings $43,938 $53,063 $53,157Other comprehensive earnings (loss) (8,740) 1,183 2,845Comprehensive earnings $35,198 $54,246 $56,002
Retained earnings at beginning of year. $135,866 $147,687 $144,949Net earnings 43,938 53,063 53,157Cash dividends (18,360) (18,078) (17,790)Stock dividends (47,175) (46,806) (32,629)Retained earnings at end of year $114,269 $135,866 $147,687
Earnings per share $0.76 $0.90 $0.89
Average Common and Class B Common shares outstanding 57,892 58,685 59,425(The accompanying notes are an integral part of these statements.)
CONSOLIDATED STATEMENTS OFFinancial Position
TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIES (in thousands except per share data)
Assets December 31,2011 2010
CURRENT ASSETS:Cash and cash equivalents $78,612 $115,976Investments 10,895 7,996Accounts receivable trade, less allowances of $1,731 and $1,531 41,895 37,394Other receivables 3,391 9,961Inventories:Finished goods and work-in-process 42,676 35,416Raw materials and supplies 29,084 21,236Prepaid expenses 5,070 6,499Deferred income taxes 578 689Total current assets 212,201 235,167
PROPERTY, PLANT AND EQUIPMENT, at cost:Land 21,939 21,696Buildings 107,567 102,934Machinery and equipment 322,993 307,178Construction in progress 2,598 9,243
455,097 440,974Less—Accumulated depreciation 242,935 225,482Net property, plant and equipment 212,162 215,492
OTHER ASSETS:Goodwill 73,237 73,237Trademarks 175,024 175,024Investments 96,161 64,461Split dollar officer life insurance 74,209 74,441Prepaid expenses 3,212 6,680Equity method investment 3,935 4,254Deferred income taxes 7,715 9,203Total other assets 433,493 407,300Total assets $857,856 $857,959
Liabilities and Shareholders’ Equity December 31,2011 2010
CURRENT LIABILITIES:Accounts payable $10,683 $9,791Dividends payable 4,603 4,529Accrued liabilities 43,069 44,185Total current liabilities 58,355 58,505
NONCURRENT LIABILITES:Deferred income taxes 43,521 47,865Postretirement health care and life insurance benefits 26,108 20,689Industrial development bonds 7,500 7,500Liability for uncertain tax positions 8,345 9,835Deferred compensation and other liabilities 48,092 46,157Total noncurrent liabilities 133,566 132,046
SHAREHOLDERS’ EQUITY:Common stock, $.69-4/9 par value—120,000 shares authorized—36,479 and 36,057 respectively, issued
25,333 25,040
Class B common stock, $.69-4/9 par value—40,000 shares authorized—21,025 and 20,466 respectively, issued
14,601 14,212
Capital in excess of par value 533,677 505,495Retained earnings, per accompanying statement 114,269 135,866Accumulated other comprehensive loss (19,953) (11,213)Treasury stock (at cost)—71 shares and 69 shares, respectively (1,992) (1,992)Total shareholders’ equity 665,935 667,408
Total liabilities and shareholders’ equity $857,856 $857,959
TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIESCONSOLIDATED STATEMENTS OF
Cash Flows (in thousands)For the year ended December
31,2011 2010 2009
CASH FLOWS FROM OPERATING ACTIVITIES: Net earnings $43,938 $53,063 $53,157 Adjustments to reconcile net earnings to net cash provided by operating activities: Depreciation 19,229 18,279 17,862 Impairment charges — — 14,000 Impairment of equity method investment — — 4,400 Loss from equity method investment 194 342 233 Amortization of marketable security premiums 1,267 522 320 Changes in operating assets and liabilities: Accounts receivable (5,448) 717 (5,899) Other receivables 3,963 (2,373) (2,088) Inventories (15,631) (1,447) 455 Prepaid expenses and other assets 5,106 4,936 5,203 Accounts payable and accrued liabilities 84 2,180 (2,755) Income taxes payable and deferred (5,772) 2,322 (12,543) Postretirement health care and life insurance benefits 2,022 1,429 1,384 Deferred compensation and other liabilities 2,146 2,525 2,960 Others (708) 310 305 Net cash provided by operating activities 50,390 82,805 76,994CASH FLOWS FROM INVESTING ACTIVITIES: Capital expenditures (16,351) (12,813) (20,831) Net purchase of trading securities (3,234) (2,902) (1,713) Purchase of available for sale securities (39,252) (9,301) (11,331) Sale and maturity of available for sale securities 7,680 8,208 17,511 Net cash used in investing activities (51,157) (16,808) (16,364) CASH FLOWS FROM FINANCING ACTIVITIES: Shares repurchased and retired (18,190) (22,881) (20,723) Dividends paid in cash (18,407) (18,130) (17,825) Net cash used in financing activities (36,597) (41,011) (38,548)
Increase (decrease) in cash and cash equivalents (37,364) 24,986 22,082
Cash and cash equivalents at beginning of year 115,976 90,990 68,908Cash and cash equivalents at end of year $78,612 $115,976 $90,990
Supplemental cash flow information Income taxes paid $16,906 $20,586 $22,364 Interest paid $38 $49 $182 Stock dividend issued $47,053 $46,683 $32,538
(The accompanying notes are an integral part of these statements.)
Based on the information contained in these financial statements, determine the following values for each company. (Round all percentages to 1 decimal places, e.g. 17.5%, and all other answers to thousands.)
(1) Profit margin for 2011. (For Tootsie Roll, use “Total Revenue.”)
Profit margin ratio
Tootsie Roll %
Hershey Company
%
(2) Gross profit for 2011. (For Tootsie Roll, use “Product” amounts.)
Gross profit (000’s)
Tootsie Roll $
Hershey Company $
(3) Gross profit rate for 2011. (For Tootsie Roll, use “Product” amounts.)
Gross profit rate
Tootsie Roll %
Hershey Company
%
(4) Operating income for 2011.
Operating income (000's)
Tootsie Roll $
Hershey Company $
(5) Percentage change in operating income from 2011 to 2010. (Show decrease with either a negative sign, e.g. -15.2% or in parentheses, e.g. (15.2)%.)
Percent change in
operating income
Tootsie Roll %
Hershey Company
%
+================================================================================
QUESTION 5)
Presented here are the components in Casilla Company’s income statement.
Determine the missing amounts.
Sales Revenue
Cost of Goods Sold
Gross ProfitOperating Expenses
Net Income
Year 1
$ 72,500 $ (a) $ 33,310 $ (b) $14,180
Year 2
$112,100 $74,480$
(c) $ (d) $29,650
Year 3
$(e) $73,790 $112,200 $49,670
$(f)
QUESTION 6)
Mike Greenberg opened Clean Window Washing Inc. on July 1, 2014. During July, the following transactions were completed.
July 1 Issued 16,197 shares of common stock for $16,197 cash.1 Purchased used truck for $12,197, paying $2,206 cash and the balance on account.3 Purchased cleaning supplies for $941 on account.5 Paid $2,400 cash on a 1-year insurance policy effective July 1.
12 Billed customers $4,900 for cleaning services.
18Paid $1,293 cash on amount owed on truck and $541 on amount owed on cleaning supplies.
20 Paid $2,249 cash for employee salaries.21 Collected $1,634 cash from customers billed on July 12.25 Billed customers $2,667 for cleaning services.31 Paid $365 for maintenance of the truck during month.31 Declared and paid $634 cash dividend.
Journalize the July transactions. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. Record journal entries in the order presented in the problem.)
DateAccount Titles and Explanation
Debit Credit
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Post to the ledger accounts. (Post entries in the order of journal entries presented in the previous question.)
Cash
Accounts Receivable
Supplies
Prepaid Insurance
Equipment
Accounts Payable
Common Stock
Dividends
Service Revenue
Maintenance and Repairs Expense
Salaries and Wages Expense
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Prepare a trial balance at July 31.CLEAN WINDOW WASHING INC.
Trial BalanceJuly 31, 2014
Debit Credit
$ $
$ $
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Journalize the following adjustments. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
(1)Services performed but unbilled and uncollected at July 31 were $1,866.
(2) Depreciation on equipment for the month was $211.(3) One-twelfth of the insurance expired.(4) An inventory count shows $320 of cleaning supplies on hand at July
31.(5) Accrued but unpaid employee salaries were $424.
No.
Account Titles and Explanation
Debit Credit
1.
2.
3.
4.
5.
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Post adjusting entries to the T-accounts.
Cash
7/1 16,197 7/1 2,206
7/21 1,634 7/5 2,400
7/18 1,834
7/20 2,249
7/31 365
7/31 634
7/31 Bal. 8,143
Accounts Receivable
7/12 4,900 7/21 1,634
7/25 2,667
Supplies
7/3 941
Prepaid Insurance
7/5 2,400
Equipment
7/1 12,197
7/31 Bal. 12,197
Accumulated Depreciation-Equipment
Accounts Payable
7/18 1,834 7/1 9,991
7/3 941
7/31 Bal. 9,098
Salaries and Wages Payable
Common Stock
7/1 16,197
7/31 Bal. 16,197
Dividends
7/31 634
7/31 Bal. 634
Service Revenue
7/12 4,900
7/25 2,667
Maintenance and Repairs Expense
7/31 365
7/31 Bal. 365
Supplies Expense
Depreciation Expense
Insurance Expense
Salaries and Wages Expense
7/20 2,249
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Prepare an adjusted trial balance.
CLEAN WINDOW WASHING INC.Trial BalanceJuly 31, 2014
Debit Credit
$ $
$ $
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Prepare the income statement for July.
CLEAN WINDOW WASHING INC.Income Statement
For the Month Ended July 31, 2014
$
$
$
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Prepare a retained earnings statement for July. (List items that increase retained earnings first.)
CLEAN WINDOW WASHING INC.Retained Earnings Statement
For the Month Ended July 31, 2014
$
:
:
$
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Prepare a classified balance sheet at July 31. (List current assets in order of liquidity.)
CLEAN WINDOW WASHING INC.Balance SheetJuly 31, 2014
Assets
$
$
:
$
Liabilities and Stockholders' Equity
$
$
$
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Journalize closing entries. (Credit account titles are automatically indented when the amount is entered. Do not indent manually.)
Account Titles and Explanation
Debit Credit
(To close revenue account)
(To close expense accounts)
(To close net income / (loss))
(To close dividends)
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Post closing entries and complete the closing process.
Cash
7/1 16,197 7/1 2,206
7/21 1,634 7/5 2,400
7/18 1,834
7/20 2,249
7/31 365
7/31 634
7/31 Bal. 8,143
Accounts Receivable
7/12 4,900 7/21 1,634
7/25 2,667
7/31 1,866
7/31 Bal. 7,799
Supplies
7/3 941 7/31 621
7/31 Bal. 320
Prepaid Insurance
7/5 2,400 7/31 200
7/31 Bal. 2,200
Equipment
7/1 12,197
7/31 Bal. 12,197
Accumulated Depreciation-Equipment
7/31 211
7/31 Bal. 211
Accounts Payable
7/18 1,834 7/1 9,991
7/3 941
7/31 Bal. 9,098
Salaries and Wages Payable
7/31 424
7/31 Bal. 424
Common Stock
7/1 16,197
7/31 Bal. 16,197
Retained Earnings
Dividends
7/31 634
Income Summary
Service Revenue
7/12 4,900
7/25 2,667
7/31 1,866
Maintenance and Repairs Expense
7/31 365
Supplies Expense
7/31 621
Depreciation Expense
7/31 211
Insurance Expense
7/31 200
Salaries and Wages Expense
7/20 2,249
7/31 424
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Prepare a post-closing trial balance at July 31.
CLEAN WINDOW WASHING INC.Post-Closing Trial Balance
July 31, 2014
Debit Credit
$ $
$ $
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