Chapter 5 Assinment Essay

The rise in revenue was rapid starting from the year of operations. The key period of business was from April to September were revenues were equal to 65% of total revenue as the product was seasonal. The basis of forecasting for the year 1981 & 1982 is the expectations of sales by Mr. Turner & Mr. Rose. It is given that total sales were $ 15.80 million in first half of year 1981 and the total sales in 1981 to reach $ 30 million. Profit after tax was expected to be $ 1 million for 1st half and we assumed for the next half, profit will be in proportion to first half & expected to be amounting to $ 0.90 million. For year 1982, the sales expectation by Mr. Rose was around more than $ 71 million &

6. Note 8 states Harnischfeger’s allowance for doubtful accounts.  Compute the ratio of the allowance to gross receivables (receivables before the allowance) in 1983 and 1984.  What would the allowance have been if the company maintained the ratio at the 1983 level?  How much did the pre-tax

One of specialty’s managers felt that the profit potential was so great that the order quantity should have a 70% chance of meeting demand and only a 30% chance of any stock-outs. What quantity would be ordered under this policy, and what is the projected profit under the three sales scenarios?

b. What is the total balance of Jessie Robinson 's revolving account? (0.5 points) N/A

* If we surmise that the company’s specialist’s predictions of 4% on market growth along with renewing current and or adding more customer contracts then the profits should be as follows:

In our second assumption, instead of using the cost of goods per cases in 1986, we try to use the percentage it counts in the total expenses which is 50.4% and to find the sales needed to break-even. The detail of the calculation is shown in the answer for questions d. The result is that 95,635, a little bit higher than the estimated sales of 90,000.

Contribution Margin = (Unit selling price – unit variable cost) / unit selling price = ($9.00 – $2.60) / $9.00 = 0.7111 = 71.111%

For this question, ignore the forecasted receivables collection pattern in Exhibit 27.4. Using paper and pencil (do NOT use the template), calculate the projected ACP and average daily sales (ADS) under the following conditions:

1. As of December 31, 2011, what amount, if any, of sales due should be recognized in eVade’s financial statements?

(c) What will Yabba’s market share have to be next year for its profit to be the same as this year?

The days sales outstanding (DSO) measures the average number of days it takes a company to collect on its debts after a sale is made.

11. Accounts receivable turnover and days sales in accounts receivable for the last three years:

However, the company expects that its sales will grow 25 percent annually for the next five years. As illustrated in Table 1 the demand after 5 years will be approx.

(4 marks) (b) Determine the ending balances of Bad debts expense and Allowance for doubtful accounts for 2005 using the aging method. (5 marks) (c) Calculate the A/R turnover ratio using your answers from part (b) [aging method] and briefly comment on Elway’s management of accounts receivable. Are managers doing a good or bad job? Explain your conclusion. (3 marks) (d) Identify and discuss (in detail) two reasons why the direct write-off method for bad debts is not acceptable under GAAP. (6 marks) Question 3 (17 marks; suggested time 17 minutes) Temporary Investments On January 1, 2003, Drug Corporation Limited raised $10 million in an initial public offering (IPO) to finance research and product testing for a drug to treat individuals addicted to harmful substances. These funds were expected to last three years. As only $2.9 million was required

The sales forecast is based on projected levels of demand. All the numbers are expressed