会计专业英语章节教学案例及答案（共17章）Chapter 8.docx

Chapter 8 Case： Balance sheets for the LM Manufacturing Company are presented below, both on December 31, 2015 and December 31, 2016. We have included two balance sheets so that we may see the financial position of the firm at the beginning and end of 2016. By examining these two balance sheets, along with the income statement for 2016, we will have a more complete picture of the firms operations, as reflected in its financial statements. We are then able to see what the firm looked like at the beginning of 2016 (balance sheet on December 31, 2015); what happened during the year (income statement for 2016), and the final outcome at the end of the year (balance sheet on December 31, 2016). Balance Sheets (figures in $ thousands) The LM Manufacturing Company December 31, 2015 and 2016 2015 2016 Current Assets Cash $39 $44 Accounts receivable $70 $78 Inventories $177 $210 Prepaid expenses $14 $15 Total current assets $300 $347 Fixed assets: Gross plant and equipment $759 $838 Accumulated depreciation $355 $383 Net plant and equipment $404 $455 Land $70 $70 Total fixed assets $474 $525 Patents $30 $55 Total assets $804 $927 Liabilities and equity Current Liabilities: Accounts Payable $61 $76 Income tax payable $12 $17 Accrued wages and salaries $4 $4 Interest payable $2 $2 Total Current liabilities $79 $99 Long-term notes payable $146 $200 Total liabilities: $225 $299 Common stock $300 $300 Retained Earnings $279 $328 Total Stockholders equity $579 $628 Total liabilities and equity $804 $927 Income Statement (figures in $ thousands) The LM Manufacturing Company For the Year Ending December 31, 2006 Sales $830 Cost of Goods Sold $539 Gross Profit on Sales $291 Operating Expenses: Marketing Expenses $91 General and Administrative Expenses $71 Depreciation $28 Total Operating Expenses $190 Operating Income (EBIT) $101 Interest Expense $20 Earnings Before tax $81 Income Tax $17 Earnings after Tax $64 Dividends Paid $15 Change in Retained Earnings $49