Comparative Analysis:

Case: Sherwin Williams Company

Sherwin Williams Company, based in Cleveland, Ohio, manufactures a wide variety of paint and other coatings, which are marketed through its specialty stores and in other retail outlets. The company also manufactures paint for automobiles. The Automotive Division has had financial difficulty. During a recent year, five branch locations of the Automotive Division were closed, and new management as put in place for the branches remaining.

The following titles were shown on Sherwin Williams balance sheet for that year.

Accounts payable

Accounts receivable, less allowances

Accrued taxes

Buildings

Cash and cash equivalents

Common Stock

Employee compensation payable

Finished goods inventories

Intangibles and other assets

Land

Long-term debt

Machinery and equipment

Other accruals

Other capital

Other current assets

Other long-term liabilities

Postretirement obligations other than pensions

Retained earnings

Short-term investments

Taxes payable

Work in process and raw materials inventories

Instructions

a) Organize the accounts in the general order in which they would have been presented in a classified balance sheet.

b) When several of the branch locations of the Automotive Division were closed, what balance sheet accounts were most likely affected? Did the balance in those accounts decrease or increase?