Reference no: EM13831712

Problem 1: Income Statement, Statement of Retained Earnings, and Balance Sheet

The following list, in alphabetical order, shows the various items that regularly appear on the financial statement of Maple Park Theatres Corp. The amounts shown for balance sheet items are balances as of September 30, 2014 (With the exception of retained earnings, which is the balance on September 1, 2014), and the amounts shown for income statement items are balances for the month ended September 30,2014.

Accounts Payable	$17,600	Furniture and fixture	$34,000
Accounts receivable	6,410	Land	26,000
Advertising expense	14,500	Notes payable	20,000
Buildings	60,000	Projection equipment	25,000
Capital stock	50,000	Rent expense-movies	50,600
Cash	15,230	Retained earnings	73,780
Concessions revenue	60,300	Salaries and wages expense	46,490
Cost of concessions sold	23,450	Ticket sales	95,100
Dividends paid during the month	8,400	Water, gas, and electricity	6,700

Required:

1. Prepare an income statement for the month ended September 30,  2014  

2. Prepare a statement of retained earnings for the month ended September 30, 2014.

3. Prepare a balance sheet at September 30, 2014.

4. You have $1,000 to invest. On the basis of the statements you prepared, would you use it to buy stock in Maple Park? Explain. What other information would you want before making a final decision?

Problem 2: Classification of Financial Statement Items

Carnival Corporation & plc is one of the largest cruise companies in the world with such well-known brands as Carnival Cruise Lines, Holland America Line, and Princess Cruises. Classify each of the following items found on the company's balance sheet included in the Form 10-K for the fiscal year ended November 30, 2011 as a current assets (CA), noncurrent assets (NCA), current liability (CL), long-term liability (LTL), or stockholders equity (SE) item.

1. Trade and other receivables, net

2. Common stock of Carnival Corporation

3. Short-term borrowings

4. Inventories

5. Property and equipment, net

6. Prepaid expenses and other

7. Accounts payable

8. Goodwill

9. Retained earnings

10. Long-term debt

Problem 3: Baldwin Corp. reported the following current accounts at the end of two recent years:

	December 31, 2014	December 31, 2013
Cash	$3,000	$6,000
Accounts receivable	15,000	10,000
Inventory	12,000	8,000
Accounts payable	12,000	7,000
Wages payable	2,000	1,000
Notes payable	6,000	4,000

Required:

1. Compute Baldwin's current ratio at the end of each of the two years.

2. How has Baldwin's liquidity changed at the end of 014 compared to the end of 2013?

3. Comment  on the relative composition of Baldwin's current assets at the end of 2014 compared to the end of 2013