Horizontal Analysis

The comparative accounts payable and long-term debt balances of a company are provided below.

	Current Year	Previous Year
Accounts payable	$74,844	$69,300
Long-term debt	38,088	41,400

Based on this information, what is the amount and percentage of increase or decrease that would be shown in a balance sheet with horizontal analysis? Enter all answers as positive numbers.

	Amount of Change	Increase/Decrease	Percentage
Accounts payable	$	Increase	%
Long-term debt	$	Decrease	%

Vertical Analysis

Income statement information for Einsworth Corporation follows:

Sales	$207,000
Cost of goods sold	57,960
Gross profit	149,040

Prepare a vertical analysis of the income statement for Einsworth Corporation. If required, round percentage answers to the nearest whole number.

Einsworth Corporation
Vertical Analysis of the Income Statement
	Amount	Percentage
Sales	$207,000	%
Cost of goods sold	57,960	%
Gross profit	$149,040	%

Current Position Analysis

The following items are reported on a company's balance sheet:

Cash	$476,200
Marketable securities	372,000
Accounts receivable (net)	399,800
Inventory	240,000
Accounts payable	480,000

Determine (a) the current ratio and (b) the quick ratio. Round to one decimal place.

a. Current ratio
b. Quick ratio

Cost Flow Relationships

The following information is available for the first year of operations of Engle Inc., a manufacturer of fabricating equipment:

Sales	$1,076,800
Gross profit	290,700
Indirect labor	96,900
Indirect materials	39,800
Other factory overhead	18,300
Materials purchased	549,200
Total manufacturing costs for the period	1,188,800
Materials inventory, end of period	39,800

Using the above information, determine the following missing amounts:

a. Cost of goods sold	$
b. Direct materials cost	$
c. Direct labor cost	$

Issuance of Materials

On May 7, Darling Company purchased on account 840 units of raw materials at $21 per unit. During May, raw materials were requisitioned for production as follows: 319 units for Job 200 at $17 per unit and 361 units for Job 305 at $21 per unit.

Journalize the entry on May 7 to record the purchase.

May 7	Materials
	Accounts Payable

Feedback

May 7 Record materials at their total purchase price.

Journalize the entry on May 31 to record the requisition from the materials storeroom.

May 31	Work in Process
	Materials

Direct Labor Costs

During May, Keenan Company accumulated 580 hours of direct labor costs on Job 200 and 500 hours on Job 305. The total direct labor was incurred at a rate of $14 per direct labor hour for Job 200 and $18 per direct labor hour for Job 305.

Journalize the entry to record the flow of labor costs into production during May.

	Work in Process
	Wages Payable

Factory Overhead Costs

During May, Keenan Company incurred factory overhead costs as follows: indirect materials, $1,220; indirect labor, $5,010; utilities cost, $2,930; and factory depreciation, $2,330.

Journalize the entry to record the factory overhead incurred during May.

For a compound transaction, if an amount box does not require an entry, leave it blank.

	Factory Overhead
	Materials
	Wages Payable
	Utilities Payable
	Accumulated Depreciation-Factory