Working on the following document (excel format), only 2 questions remain.

MBA 616--ACCOUNTING PRACTICES & ANALYSIS DR. MIKE FISCHER FALL 2016 STUDENT NAME Hinds, Winthrop Scot Instructions: 1. Insert your name in the space above. 2. Save the quiz in a new file, following the format: Lastname_Firstname_Quiz1. 3. When finished, upload the file containing your final completed quiz. 4. There are 2 additional tabs at the bottom of this Excel spreadsheet, one for each of the numbered problems. 5. Some of the problems contain multiple parts or questions. Be sure to complete all parts. 6. Perform all necessary calculations in Excel, showing all work including formulas. QUIZ 1, QUESTION 1 PINE TREE COMPANY COMPARATIVE INCOME STATEMENTS FOR THE YEARS ENDED 12/31/14 AND 12/31/13 Sales Less: Cost of Goods Sold Gross profit Less: operating expenses Wage expense Depreciation expense Rent expense (in thousands) 2014 2013 1,969 1,718 1,091 878 886 832 195 36 46 176 29 40 49 77 Total operating expenses Operating income 326 552 322 510 Less: interest expense Income before tax 19 533 66 444 Less: income tax expense 213 178 Net income 320 266 Miscellaneous expense Requirements: a. Convert the income statement above to common size format. Be sure to include all appropriate formulas (20 points). Multiple Choice Place an "X" next to the best answer for each item b. What might best explain the change in gross profit % from 2013 to 2014? (10 points) 1. Increased production costs 2. Decrease in volume (quantity) of goods sold 3. Increase in selling prices 4. Decreased raw materials costs c. Which is the best explanation for the change in Net Income $ from 2013 to 2014? (10 points) 1. Increase in sales 2. Decrease in production costs 3. Decrease in miscellaneous expense 4. Increase in income tax expense d. Which is the best explanation for the change in operating income % from 2013 to 2014? (10 points) 1. Increase in sales 2. Decrease in operating expenses 3. Increase in production costs 4. Increase in income tax expense QUIZ 1, QUESTION 2 ABC COMPANY SELECTED FINANCIAL INFORMATION 2015, 2014, 2013 Current assets Current liabilities Cash Marketable securities Inventory Sales Cost of Goods Sold B 2015 950,000 525,000 210,000 105,000 375,000 1,850,000 1,250,000 8 9 10 11 12 13 14 D 2014 850,000 450,000 260,000 85,000 275,000 2,100,000 1,450,000 Assume: 1. ABC's current assets are comprised of cash, accounts receivable, marketable securities and inventory at the end of each year. 2. 10% of sales are for cash; the remainder of sales are on credit. Requirements: Calculate each of the following ratios for 2014 and 2015 in the space below. Be sure to show your work, including appropriate formulas. a. Working capital (10 points) b. Current ratio (10 points) c. Quick (Acid Test) ratio (10 points) d. Inventory turnover (10 points) e. Days sales outstanding in receivables (10 points) 425,000 B8-B9 1.81 B8/B9 3.77 (B10+B11+(0.9*B13))/B9 400,000 D8-D9 1.89 D8/D9 4.97 (D10+D11+(0.9*D13))/D9 2013 800,000 500,000 245,000 75,000 325,000 1,750,000 1,250,000 D11+(0.9*D13))/D9