Record entries and build the financial statements

Assignment Help Financial Management

Reference no: EM13173078

PART I Record Entries and Build the Financial Statements

1. Company Introduction and Overview

Give me quick overview of your company. What is your company's name? What products and services do you sell?

2. Journal Entry List

Record entries from the transaction and event list provided below in proper journal entry format. NOTE: You are recording entries for the fiscal year 2011 (Jan 1 - Dec 31). This list must be organized. Make sure that I can easily identify the journal entry with the related transaction/event. Show your work if the entry requires you to make a calculation (i.e. depreciation, interest expense, etc.).

3. Chart of T-Accounts

Create a chart of T-Accounts and post each journal entry to the appropriate accounts.

4. Financial Statements

Build an income statement and balance sheet for the year ending December 31, 2011. Create a statement of cash flows for 2011.

Part-2

5. Ratio Analysis

Compute the following using the information from the financial statements you have produced for 2011. Show your work. Explain to me what every calculation means (i.e. explain the answer to me in non-book language).

- Earnings Per Share
- Price-earnings ratio
- Return on Equity
- Working Capital
- Current Ratio
- Quick Ratio
- AR Turnover
- Inventory Turnover
- Gross Profit
- Gross Profit Ratio
- Operating Income
- Operating Margin
- Debt-to-equity ratio
- Book value per share

6. Business Analysis

Perform an analysis of your business using your results from the required calculations listed above and any other trend information you deem to be relevant. Use these calculations to determine how the company is doing overall. Hint: Consider creating graphs/tables to support your conclusions NOTE: Before you prepare your response to this question, you need to come up to me and ask from which "point of view" you are to analyze the company. You will either be a banker, an investor (stockholder), or the CEO of this company. This is not for you to choose. I will assign this (once you ask).

7. Projected Income Statement for 2012

Build a projected income statement for next year based on forecasted sales that equal $3,250,000. Use the results of the analysis you performed in the preceding question and any other information you deem to be relevant to build this income statement. Provide a brief explanation of the method(s) your group used to determine the projected numbers.

8. Actual vs. Predicted Earnings Per Share Evaluation

Analysts predicted earnings per share (EPS) for your company to be $0.12 at the close of 2011. How does this compare to actual EPS for 2011? If actual EPS is higher than the analysts' prediction, what factors contributed to the success? If actual EPS is lower than the prediction, how will you explain the shortfall to your investors? Is there anything you could have done to meet the prediction? NOTE: Assume that you are the CEO of the company when preparing your response to this question.

Attachment:- Financial - Stmnt.pdf

Reference no: EM13173078

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