Ex 1 Chapter Five-Manual Homework Indicate whether each of the following statements is true or false. a) In developing an accounting system, the cost is relevant. The benefits obtained from the information disseminated must outweigh the cost of providing it. b) When the enviroment changes as a result of technological advances, increased competition, or government regulation, an accounting system does not have to be sufficiently flexible to meet the changes in order to save money. c) When designing an acccounting system, we need to think about the needs and knowledge of both the top managers and various other users. Ex 2 A company uses subsidiary ledgers for Accounts Receivable and Accounts Payable. Transactions that are made "on account" are posted to these subsidiary ledgers in the individual customer or creditor accounts. a) Why do companies use subsidiary ledgers for accounts payable and accounts receivable? b) Identify 2 other Asset or Liability accounts that could benefit from using a subsidiary ledger. Ex 3 Nolo Company has a balance in its Accounts Payable control account of $8,250 on January 1, 2001. The A/P Subsidiary Ledger contains 3 accounts: Jones Company, $3,000; Brown Company, $1,875; and Arron Company. During January, the following purchase-related transactions occurred. Purchases Jones Company $6,750 Brown Company $5,250 Arron Company $6,375 Payments $6,000 $1,875 $6,750 Returns 50 $2,250 $0 a) What is the January 1 balance in the Aaron Company subsidiary ledger account? b) What is the January 31 balance in the control account? Brown Company- Aaron Company- c) Compute the balance in each subsidiary account at the end of the month. Jones Company- d) Which January transaction would not be recorded in a special journal. Ex 4 The comparative segment revenues for Yumi Brands, a glodal quick-serve restaurant company, are as follows: KFC Taco Bell Pizza Hut Total Recent Year (in millions) $3,105 1,880 893 $5,878 Prior Year (in millions) $2,644 2,056 988 $5,688 a) Provide a horizontal analysis of the segment revenues using the prior year as the base year. Round whole percents to one decimal place. b) Provide a vertical analysis of the segment revenues for both years. Round whole percents to one decimal place. c) What conclusions can be dawn from your analysis?