FM 102 – FINANCIAL MANAGEMENT
The following are the financial position and income statement data of Simple Lang Company:
2021 2022
Cash 150,000 283,000
Marketable Securities 850,000 1,000,000
Accounts Receivable, net 500,000 1,000,000
Inventory 750,000 500,000
Land 500,000 500,000
Building, net 550,000 500,000
Machinery and Equipment, net 1,700,000 1.500,000
Goodwill 400,000 400,000
Deferred Tax Asset 100,000 90,000
Notes Payable, trade 100,000 150,000
Account Payable, trade 610,000 790,000
Accrued Expenses 40,000 60,000
Long-term Notes Payable 2,500,000 2,250,000
15% Preferred Stock, P100 par 500,000 500,000
Common Stock, P10 par 1,500,000 1,500,000
Retained Earnings 250,000 523,000
Sales 5,250,000
Sales returns and Allowance 250,000
Inventory, December 31, 2022 500,000
Inventory, December 31, 2021 750,000
Purchases 2,750,000
Selling Expenses 400,000
Administrative Expense (including depreciation of P250,000) 600,000
Interest on Long-term notes 250,000
Income Taxes, 30%
REQUIREMENTS:
Part I:
1. Prepare Comparative Statement of Financial Position for 2021 and 2022 (Vertical Analysis).
2. Provide the amounts for the unknown totals.
3. Write your answer in a paper using the format below and round off to two decimal places.
Name:________________________________________________ Schedule: ______________
2021 2022
ASSETS AMOUNT % AMOUNT %
Current Assets:
Cash
Marketable Securities
Accounts Receivable, net
Inventories
Total Current Assets
Non-current Assets
Land
Building, net
Machinery & Equipment, net
Goodwill
Deferred Tax Asset
Total Non-current Assets
TOTAL ASSETS
LIABILITIES AND SHAREHOLDERS’
EQUITY
Current Liabilities:
Notes payable, Trade
Accounts Payable, Trade
Accrued Expenses
Total Current Liabilities
Non-current Liabilities
Long-term Notes Payable
Total Liabilities
SHAREHOLDERS’ EQUITY:
15% Preferred Stock, P100 par
Common Stock, P10 par
Retained Earnings
Total Shareholders’ Equity
TOTAL LIABILITIES AND SHAREHOLDERS’
EQUITY
Part II.
1. Prepare Common-size Income Statement for the year ended December 31, 2022 with
common-size percentage (Vertical analysis).
2. Write your answer in a paper using the format below and round off to two decimal places.
AMOUNT PERCENT
Sales
Less: Sales returns and allowance
Net Sales
Cost of Sales:
Inventory, December 31, 2021
Add: Purchases
Total Goods Available for Sale
Less: Inventory, December, 31, 2022
Cost of Sales
Gross profit
Less: Operating Expenses
Selling expenses
Administrative expenses
Total Operating Expenses
Income from Operations
Less: Interest Expense
Income before Income Tax
Less: Income Tax
NET INCOME
Part III:
1. Prepare a comparative Statement of Financial Position for 2021 and 2022 (Horizontal Analysis)
NAME:________________________________________________ SCHEDULE:____________
INCREASE (DECREASE)
ASSETS 2021 2022 AMOUNT %
Current Assets:
Cash
Marketable Securities
Accounts Receivable, net
Inventories
Total Current Assets
Non-current Assets
Land
Building, net
Machinery & Equipment, net
Goodwill
Deferred Tax Asset
Total Non-current Assets
TOTAL ASSETS
LIABILITIES AND SHAREHOLDERS’
EQUITY
Current Liabilities:
Notes payable, Trade
Accounts Payable, Trade
Accrued Expenses
Total Current Liabilities
Non-current Liabilities
Long-term Notes Payable
Total Liabilities
SHAREHOLDERS’ EQUITY:
15% Preferred Stock, P100 par
Common Stock, P10 par
Retained Earnings
Total Shareholders’ Equity
TOTAL LIABILITIES AND SHAREHOLDERS’
EQUITY
