Reference no: EM132703845
Questions -
Problem 1: For this question, please refer to the Dino's After School Trial Balance with ending totals for December 31, 2014 in the table below:
Account Balance ($)
Checking 15,220
Savings 58,500
Money Market 41,650
Pre-Paid Rent 5,400
Accounts Receivable 81,000
Accounts Receivable Allowances-6,500
Machinery 122,600
Equipment 80,300
Automobiles 67,500
Accounts Payable 60,000
Loans Payable 21,300
Equity 384,370
1. Using an Excel Spreadsheet, create the Balance Sheet for Dino's After School.
2. Using the information obtained from your Balance Sheet, calculate any one (1) liquidity and any one (1) leverage ratio.
3. Comment on the financial position of the organization, specific to the two ratios you calculated. What is the main reason that Dino's (and other organizations) need a Balance Sheet?
Problem 2: Please refer to the corporate tax rates table and the Gross Profit Chart below:
Account Balance ($)
0 to 50,000 15%
50,000 to 75,000 $7,500 + 25% of the amount over 50,000
75,000 to 100,000 $13,750 + 34% of the amount over 75,000
100,000 to 335,000 $22,250 + 39% of the amount over 100,000
335,000 to 10,000,000 $113,900 + 34% of the amount over 335,000
10,000,000 to 15,000,000 $3,400,000 + 35% of the amount over 10,000,000
15,000,000 to 18,333,333 $5,150,000 + 38% of the amount over 15,000,000
18,333,333 and up 35%
Fiscal Year Gross Profit ($)
June, 2009 - May, 2010 261,100
June, 2011 - May, 2012 277,500
June, 2012 - May, 2013 292,000
June, 2013 - May, 2014 300,900
1. Given the information provided here perform your own calculations to show the amount of corporate tax paid for each of the four (4) fiscal years covered in the table above.
2. Is there a pattern? Explain the pattern and what it may suggest about the future performance of the organization. How can this conclusion advise investors and organizational decision makers?
3. If there was a 20% reduction in the Gross Profit for fiscal year 6/12 - 5/13, how might this have changed the gross profit expectations for the 6/13 - 5/14 fiscal year? Provide rationale.
4. Calculate the total expected taxes that would have been paid for these two fiscal years, with the 20% reduction in 6/12 - 5/13 and the resultant expected change in the 6/13 - 5/14 gross profit.
Problem 3: Explain the concept of departmentalized accounting and the importance of collaboration between departments within an organization, to its success. You may use organizational examples.