ACCT 2101 Financial Statement Analysis Group Project Activity for Ch 9 MULTIPLE DUE DATES - SEE D2L Purpose: The purposes of this assignment are to introduce you to the concepts of financial statements analysis, to help you develop knowledge and skills associated with financial statement analysis, to provide a comprehensive example that can be used for application of previously learned concepts and skills, and to foster your collaboration and communication skills. . Skills: The assignment will help you develop and practice the following skills Understand the components of the Income Statement and Balance Sheet Analytical procedures for horizontal and vertical analysis Calculate financial statement ratios for liquidity, solvency, profitability, and stock Compare and analyze the results for financial statement analysis computations Evaluate the results of financial statement analysis and produce a conclusion Judge the results of financial statement analysis and select the best solution Knowledge: The assignment will help you apply knowledge learned related to Horizontal and vertical analysis Ratio analysis for liquidity, solvency, profitability, and stock Income Statement components of Revenue, Cost of Goods Sold, Gross Margin, Operating Expenses, and Net Income Balance Sheet components of Short-term Assets, Long-term Assets, Current Liabilities, Long-term Liabilities, Retained Earnings, and Stockholders' Equity Limitations of Financial Statement Analysis Assignment Summary: Throughout chapter 9 we will be evaluating the performance of a company named Milavec Company for years 3, 4 and 5. We do not have a lot of details about the company's operations, but we do have an Income Statement and Balance Sheet for years 3, 4 and 5. We do not know the company's industry, but we can determine some facts about the company based on the information presented. Your job will be to unravel the information available, analyze the financial statements (including the Year 5 financials provided below.) and draw some conclusions. Groups have been created in D2L. Please find your group and establish communication within your group members as to organize how your group will "operate". Each group will work together throughout the coverage of Ch 9 to produce (at least three analytical assessments and a summary of conclusions. The final result of your work will be submitted to your Group Folder in D2L. Assignment Specifics: Part A - 5pts - To be completed (individually) before we start Ch 9 - Submit to Assignment folder named "FSA Individual Observations" due by Sunday, April 24". Review the Milavec Financial Statements as presented in your book or Power Points (also, attached at the bottom of this assignment - but you do not need to include Year 5 at this point) and make some initial observations about the company. Individually, come up with at least 3 observations about the company you can share with your group. (For example, by looking at the Income Statement you can see that the company is currently operating profitably. Your observations can be simple or complex, broad (like the example provided) or detailed. Year 3 800,000 Milavec Company Income Statement and Statement of Retained Earnings For the Years Ending Year 5 Year 4 Sales $ 1,600,000 $ 900,000 $ Cost of Goods Sold Beginning Inventory $ 70,000 $ 43,000 $ Purchases $ 1,078,000 $ 637,000 $ Goods available for sale $ 1,148,000 $ 680,000 $ Ending Inventory $ 60,000 $ 70,000 $ Cost of Goods Sold $ 1,088,000 $ 610,000 $ Gross Margin $ 512,000 $ 290,000 $ Operating Expenses $ 480,000 $ 248,000 $ Income before taxes $ 32,000 $ 42,000 $ Income taxes $ 12,800 $ 17,000 $ Net Income $ 19,200 $ 25,000 $ Plus: Beg bal Retained Earnings $ 162,000 $ 137,000 $ Less: Dividends $ 6,000 $ $ Ending Balance Retained Earnings $ 175,200 $ 162,000 $ 40,000 483,000 523,000 43,000 480,000 320,000 280,000 40,000 18,000 22,000 130,000 15,000 137,000 Milavec Company Balance Sheet As of December 31 Year 5 Year 4 Year 3 Assets Cash $ Marketable Securities Notes Receivable Accounts Receivable Merchandise Inventory Prepaid Expenses Property Plant and Equipment (net) Total Assets 36,200 $ 20,000 $ $ 65,000 $ 60,000 $ $ 340,000 $ 521,200 $ 20,000 $ 20,000 $ 4,000 $ 50,000 $ 70,000 $ 4,000 $ 340,000 $ 508,000 $ 17,000 22.000 3,000 56,000 43,000 4,000 310,000 455,000 $ $ Liabilities and Stockholder's Equity Accounts Payable $ Salaries Payable Taxes Payable $ Bonds Payable, 8% $ Preferred Stock, 6%, $100 par, cumulative $ Common Stock, $10 par $ Retained Earnings $ Total Liabilities and Stockholders' Equity $ 40,000 $ 2,000 $ 4,000 $ 100,000 $ 50,000 $ 150,000 $ 175,200 $ 521,200 $ 40,000 $ 2,000 $ 4,000 $ 100,000 $ 50,000 $ 150,000 $ 162,000 $ 508,000 $ 38,000 3,000 2,000 100,000 50,000 125,000 137,000 455,000 ACCT 2101 Financial Statement Analysis Group Project Activity for Ch 9 MULTIPLE DUE DATES - SEE D2L Purpose: The purposes of this assignment are to introduce you to the concepts of financial statements analysis, to help you develop knowledge and skills associated with financial statement analysis, to provide a comprehensive example that can be used for application of previously learned concepts and skills, and to foster your collaboration and communication skills. . Skills: The assignment will help you develop and practice the following skills Understand the components of the Income Statement and Balance Sheet Analytical procedures for horizontal and vertical analysis Calculate financial statement ratios for liquidity, solvency, profitability, and stock Compare and analyze the results for financial statement analysis computations Evaluate the results of financial statement analysis and produce a conclusion Judge the results of financial statement analysis and select the best solution Knowledge: The assignment will help you apply knowledge learned related to Horizontal and vertical analysis Ratio analysis for liquidity, solvency, profitability, and stock Income Statement components of Revenue, Cost of Goods Sold, Gross Margin, Operating Expenses, and Net Income Balance Sheet components of Short-term Assets, Long-term Assets, Current Liabilities, Long-term Liabilities, Retained Earnings, and Stockholders' Equity Limitations of Financial Statement Analysis Assignment Summary: Throughout chapter 9 we will be evaluating the performance of a company named Milavec Company for years 3, 4 and 5. We do not have a lot of details about the company's operations, but we do have an Income Statement and Balance Sheet for years 3, 4 and 5. We do not know the company's industry, but we can determine some facts about the company based on the information presented. Your job will be to unravel the information available, analyze the financial statements (including the Year 5 financials provided below.) and draw some conclusions. Groups have been created in D2L. Please find your group and establish communication within your group members as to organize how your group will "operate". Each group will work together throughout the coverage of Ch 9 to produce (at least three analytical assessments and a summary of conclusions. The final result of your work will be submitted to your Group Folder in D2L. Assignment Specifics: Part A - 5pts - To be completed (individually) before we start Ch 9 - Submit to Assignment folder named "FSA Individual Observations" due by Sunday, April 24". Review the Milavec Financial Statements as presented in your book or Power Points (also, attached at the bottom of this assignment - but you do not need to include Year 5 at this point) and make some initial observations about the company. Individually, come up with at least 3 observations about the company you can share with your group. (For example, by looking at the Income Statement you can see that the company is currently operating profitably. Your observations can be simple or complex, broad (like the example provided) or detailed. Year 3 800,000 Milavec Company Income Statement and Statement of Retained Earnings For the Years Ending Year 5 Year 4 Sales $ 1,600,000 $ 900,000 $ Cost of Goods Sold Beginning Inventory $ 70,000 $ 43,000 $ Purchases $ 1,078,000 $ 637,000 $ Goods available for sale $ 1,148,000 $ 680,000 $ Ending Inventory $ 60,000 $ 70,000 $ Cost of Goods Sold $ 1,088,000 $ 610,000 $ Gross Margin $ 512,000 $ 290,000 $ Operating Expenses $ 480,000 $ 248,000 $ Income before taxes $ 32,000 $ 42,000 $ Income taxes $ 12,800 $ 17,000 $ Net Income $ 19,200 $ 25,000 $ Plus: Beg bal Retained Earnings $ 162,000 $ 137,000 $ Less: Dividends $ 6,000 $ $ Ending Balance Retained Earnings $ 175,200 $ 162,000 $ 40,000 483,000 523,000 43,000 480,000 320,000 280,000 40,000 18,000 22,000 130,000 15,000 137,000 Milavec Company Balance Sheet As of December 31 Year 5 Year 4 Year 3 Assets Cash $ Marketable Securities Notes Receivable Accounts Receivable Merchandise Inventory Prepaid Expenses Property Plant and Equipment (net) Total Assets 36,200 $ 20,000 $ $ 65,000 $ 60,000 $ $ 340,000 $ 521,200 $ 20,000 $ 20,000 $ 4,000 $ 50,000 $ 70,000 $ 4,000 $ 340,000 $ 508,000 $ 17,000 22.000 3,000 56,000 43,000 4,000 310,000 455,000 $ $ Liabilities and Stockholder's Equity Accounts Payable $ Salaries Payable Taxes Payable $ Bonds Payable, 8% $ Preferred Stock, 6%, $100 par, cumulative $ Common Stock, $10 par $ Retained Earnings $ Total Liabilities and Stockholders' Equity $ 40,000 $ 2,000 $ 4,000 $ 100,000 $ 50,000 $ 150,000 $ 175,200 $ 521,200 $ 40,000 $ 2,000 $ 4,000 $ 100,000 $ 50,000 $ 150,000 $ 162,000 $ 508,000 $ 38,000 3,000 2,000 100,000 50,000 125,000 137,000 455,000