ACC 290 Week 2 Assignment 2
Description / Instructions: Complete the following Week 2 Assignment in WileyPLUS: * BYP 2-2 * IFRS
2-6 * Exercise 3-4 * Exercise 3-8 * Exercise 3-10 * BYP 3-2 * IFRS 3-2 * Problem 3-5A * Problem 3-6A
Question 1
Foyle Architects incorporated as licensed architects on April 1, 2014. During the first month of
the operation of the business, these events and transactions occurred:
Apr. 1
Stockholders invested $21,541 cash in exchange for common stock of the corporation.
1
Hired a secretary-receptionist at a salary of $449 per week, payable monthly.
2
Paid office rent for the month $1,077.
3
Purchased architectural supplies on account from Burlington Company $1,556.
10
Completed blueprints on a carport and billed client $2,274 for services.
11
Received $838 cash advance from J. Madison to design a new home.
20
Received $3,351 cash for services completed and delivered to M. Svetlana.
30
Paid secretary-receptionist for the month $1,796.
30
Paid $359 to Burlington Company for accounts payable due.
Journalize the transactions. (If no entry is required, select "No entry" for the account titles
and enter 0 for the amounts. Credit account titles are automatically indented when
amount is entered. Do not indent manually. Record journal entries in the order
presented in the problem.)
Date
Account Titles and
Explanation
Debit
Credit
Post to the ledger T-accounts. (Post entries in the order of journal entries presented in the
question.)
Cash
Accounts Receivable
Supplies
Accounts Payable
Unearned Service Revenue
Common Stock
Service Revenue
Salaries and Wages Expense
Rent Expense
Prepare a trial balance on April 30, 2014.
FOYLE ARCHITECTS INC.
Trial Balance
April 30, 2014
Debit
Credit
$
$
$
Question 2
This is the trial balance of Solis Company on September 30.
SOLIS COMPANY
Trial Balance
September 30, 2014
Debit
Cash
Credit
$ 23,340
Accounts Receivable
6,740
Supplies
4,750
Equipment
10,650
Accounts Payable
$ 8,940
Unearned Service Revenue
3,750
Common Stock
19,140
Retained Earnings
13,650
$45,480
$45,480
The October transactions were as follows.
Oct. 5
Received $1,420 in cash from customers for accounts receivable due.
10
Billed customers for services performed $5,180.
15
Paid employee salaries $1,200.
17
Performed $560 of services in exchange for cash.
20
Paid $1,960 to creditors for accounts payable due.
$
29
Paid a $350 cash dividend.
31
Paid utilities $470.
Prepare a general ledger using T-accounts. Enter the opening balances in the ledger accounts as
of October 1.
Cash
Accounts Receivable
Supplies
Equipment
Accounts Payable
Unearned Service Revenue
Common Stock
Retained Earnings
Journalize the transactions. (Credit account titles are automatically indented when amount
is entered. Do not indent manually. Record journal entries in the order presented in the
problem.)
Date
Account Titles and
Explanation
Debit
Credit
Post to the ledger accounts. (Post entries in the order of information presented in the
question.)
Cash
10/1
B
a
l
.
23,340
Accounts Receivable
10/1
B
6,740
a
l
.
Supplies
10/1
B
a
l
.
4,750
Equipment
10/1
B
a
l
.
10,650
Accounts Payable
10/1
B
a
l
.
8,940
B
a
l
.
3,750
B
a
l
.
19,140
Unearned Service Revenue
10/1
Common Stock
10/1
Retained Earnings
10/1
Dividends
Service Revenue
Salaries and Wages Expense
Utilities Expense
13,650
Prepare a trial balance on October 31, 2014.
SOLIS COMPANY
Trial Balance
October 31, 2014
Debit
Credit
$
$
$
$
Question 3
A tabular analysis of the transactions made during August 2014 by Colaw Company during its
first month of operations is shown below. Each increase and decrease in stockholders’ equity is
explained.
= Liabilitie +
Stockholders’ Equity
s
Account
+
+ Supp + Equip =
+ Commo +
Cash
A/R
s
Retained Earnings
.
.
n Stock
Payable
Revenue–Expense –Dividend
s
s
s
Assets
$19,64
(1)
0
$19,640
Com
.
Stoc
k
$5,00
0
(2) –1,100
(3)
–700
(4)
3,720
$700
$5,81
0
(5) –2,010
(6) –1,320
(7)
–870
(8)
380
$3,900
Serv
.
Rev.
$9,530
–2,010
–$870
–$1,320Div.
Rent
Exp.
–380
(9) –3,470
(10
)
–3,470
200
–200
Salar
.
Exp.
Util.
Exp.
Determine how much stockholders’ equity increased for the month.
Increase
in
$
stockhold
ers’
equity
Compute the net income for the month.
The
net $
inco
me
Question 4
The financial statements of The Hershey Company and Tootsie Roll are presented below. Assume
Hershey’s average number of shares outstanding was 220,688,000, and Tootsie Roll’s was
57,892,000.
THE HERSHEY COMPANY
CONSOLIDATED STATEMENTS OF INCOME
For the years ended December 31,
2011
2010
In thousands of dollars except per share
amounts
Net Sales
$6,080,788
$5,671,009
Costs and Expenses:
Cost of sales
3,548,896
3,255,801
Selling, marketing and administrative
1,477,750
1,426,477
Business realignment and impairment (credits)
(886)
83,433
charges, net
Total costs and expenses
5,025,760
4,765,711
Income before Interest and Income Taxes
1,055,028
905,298
Interest expense, net
92,183
96,434
Income before Income Taxes
962,845
808,864
2009
$5,298,668
3,245,531
1,208,672
82,875
4,537,078
761,590
90,459
671,131
Provision for income taxes
333,883
299,065
235,137
Net Income
$628,962
$509,799
$435,994
Net Income Per Share—Basic—Class B
$2.58
$2.08
$1.77
Common Stock
Net Income Per Share—Diluted—Class B
$2.56
$2.07
$1.77
Common Stock
Net Income Per Share—Basic—Common Stock
$2.85
$2.29
$1.97
Net Income Per Share—Diluted—Common
$2.74
$2.21
$1.90
Stock
Cash Dividends Paid Per Share:
Common Stock
$1.3800
$1.2800
$1.1900
Class B Common Stock
1.2500
1.1600
1.0712
The notes to consolidated financial statements are an integral part of these statements and are
included in the Hershey's 2011 Annual Report, available at www.thehersheycompany.com.
THE HERSHEY COMPANY
CONSOLIDATED BALANCE SHEETS
December 31,
In thousands of dollars
ASSETS
Current Assets:
Cash and cash equivalents
Accounts receivable—trade
Inventories
Deferred income taxes
Prepaid expenses and other
Total current assets
Property, Plant and Equipment, Net
Goodwill
Other Intangibles
Deferred Income Taxes
Other Assets
Total assets
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Accounts payable
Accrued liabilities
Accrued income taxes
Short-term debt
Current portion of long-term debt
Total current liabilities
Long-term Debt
Other Long-term Liabilities
Total liabilities
Commitments and Contingencies
Stockholders’ Equity:
The Hershey Company Stockholders’ Equity
Preferred Stock, shares issued: none in 2011 and 2010
Common Stock, shares issued: 299,269,702 in 2011 and
299,195,325 in 2010
Class B Common Stock, shares issued: 60,632,042 in 2011
and 60,706,419 in 2010
Additional paid-in capital
Retained earnings
Treasury—Common Stock shares, at cost: 134,695,826 in
2011 and 132,871,512 in 2010
2011
2010
$693,686
399,499
648,953
136,861
167,559
2,046,558
1,559,717
516,745
111,913
38,544
138,722
$4,412,199
$884,642
390,061
533,622
55,760
141,132
2,005,217
1,437,702
524,134
123,080
21,387
161,212
$4,272,732
$420,017
612,186
1,899
42,080
97,593
1,173,775
1,748,500
617,276
3,539,551
—
$410,655
593,308
9,402
24,088
261,392
1,298,845
1,541,825
494,461
3,335,131
—
—
—
299,269
299,195
60,632
60,706
490,817
4,699,597
434,865
4,374,718
(4,258,962)
(4,052,101)
Accumulated other comprehensive loss
The Hershey Company stockholders’ equity
Noncontrolling interests in subsidiaries
Total stockholders’ equity
Total liabilities and stockholders’equity
(442,331)
849,022
23,626
872,648
$4,412,199
THE HERSHEY COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended December 31,
2011
2010
In thousands of dollars
Cash Flows Provided from (Used by) Operating
Activities
Net income
$628,962
$509,799
Adjustments to reconcile net income to net cash
provided from operations:
Depreciation and amortization
215,763
197,116
Stock-based compensation expense, net of tax of
28,341
32,055
$15,127, $17,413 and $19,223, respectively
Excess tax benefits from stock-based compensation
(13,997)
(1,385)
Deferred income taxes
33,611
(18,654)
Gain on sale of trademark licensing rights, net of tax
(11,072)
—
of $5,962
Business realignment and impairment charges, net of
30,838
77,935
tax of $18,333, $20,635 and $38,308, respectively
Contributions to pension plans
(8,861)
(6,073)
Changes in assets and liabilities, net of effects from
business acquisitions and divestitures:
Accounts receivable—trade
(9,438)
20,329
Inventories
(115,331)
(13,910)
Accounts payable
7,860
90,434
Other assets and liabilities
(205,809)
13,777
Net Cash Provided from Operating Activities
580,867
901,423
Cash Flows Provided from (Used by) Investing
Activities
Capital additions
(323,961) (179,538)
Capitalized software additions
(23,606)
(21,949)
Proceeds from sales of property, plant and equipment
312
2,201
Proceeds from sales of trademark licensing rights
20,000
—
Business acquisitions
(5,750)
—
Net Cash (Used by) Investing Activities
(333,005) (199,286)
Cash Flows Provided from (Used by) Financing
Activities
Net change in short-term borrowings
10,834
1,156
Long-term borrowings
249,126
348,208
Repayment of long-term debt
(256,189)
(71,548)
Proceeds from lease financing agreement
47,601
—
Cash dividends paid
(304,083) (283,434)
Exercise of stock options
184,411
92,033
Excess tax benefits from stock-based compensation
13,997
1,385
Contributions from noncontrolling interests in
—
10,199
subsidiaries
Repurchase of Common Stock
(384,515) (169,099)
Net Cash (Used by) Financing Activities
(438,818)
(71,100)
(Decrease) Increase in Cash and Cash Equivalents
(190,956)
631,037
Cash and Cash Equivalents as of January 1
884,642
253,605
Cash and Cash Equivalents as of December 31
$693,686
$884,642
(215,067)
902,316
35,285
937,601
$4,272,732
2009
$435,994
182,411
34,927
(4,455)
(40,578)
—
60,823
(54,457)
46,584
74,000
37,228
293,272
1,065,749
(126,324)
(19,146)
10,364
—
(15,220)
(150,326)
(458,047)
—
(8,252)
—
(263,403)
28,318
4,455
7,322
(9,314)
(698,921)
216,502
37,103
$253,605
Interest Paid
Income Taxes Paid
$97,892
292,315
$97,932
350,948
$91,623
252,230
TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
Earnings, Comprehensive Earnings and Retained Earnings (in thousands except per
share data)
For the year ended December 31,
2011
2010
2009
Net product sales
$528,369
$517,149
$495,592
Rental and royalty revenue
4,136
4,299
3,739
Total revenue
532,505
521,448
499,331
Product cost of goods sold
365,225
349,334
319,775
Rental and royalty cost
1,038
1,088
852
Total costs
366,263
350,422
320,627
Product gross margin
163,144
167,815
175,817
Rental and royalty gross margin
3,098
3,211
2,887
Total gross margin
166,242
171,026
178,704
Selling, marketing and administrative expenses
108,276
106,316
103,755
Impairment charges
—
—
14,000
Earnings from operations
57,966
64,710
60,949
Other income (expense), net
2,946
8,358
2,100
Earnings before income taxes
60,912
73,068
63,049
Provision for income taxes
16,974
20,005
9,892
Net earnings
$43,938
$53,063
$53,157
Net earnings
Other comprehensive earnings (loss)
Comprehensive earnings
Retained earnings at beginning of year.
Net earnings
Cash dividends
Stock dividends
Retained earnings at end of year
Earnings per share
$43,938
(8,740)
$35,198
$135,866
43,938
(18,360)
(47,175)
$114,269
$0.76
$53,063
1,183
$54,246
$53,157
2,845
$56,002
$147,687
53,063
(18,078)
(46,806)
$135,866
$144,949
53,157
(17,790)
(32,629)
$147,687
$0.90
Average Common and Class B Common shares
57,892
58,685
outstanding
(The accompanying notes are an integral part of these statements.)
$0.89
59,425
CONSOLIDATED STATEMENTS OF
Financial Position
TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIES (in thousands except per share
data)
Assets
December 31,
2011
2010
CURRENT ASSETS:
Cash and cash equivalents
$78,612
$115,976
Investments
10,895
7,996
Accounts receivable trade, less allowances of $1,731 and $1,531
41,895
37,394
Other receivables
3,391
9,961
Inventories:
Finished goods and work-in-process
42,676
35,416
Raw materials and supplies
Prepaid expenses
Deferred income taxes
Total current assets
PROPERTY, PLANT AND EQUIPMENT, at cost:
Land
Buildings
Machinery and equipment
Construction in progress
Less—Accumulated depreciation
Net property, plant and equipment
OTHER ASSETS:
Goodwill
Trademarks
Investments
Split dollar officer life insurance
Prepaid expenses
Equity method investment
Deferred income taxes
Total other assets
Total assets
Liabilities and Shareholders’ Equity
CURRENT LIABILITIES:
Accounts payable
Dividends payable
Accrued liabilities
Total current liabilities
NONCURRENT LIABILITES:
Deferred income taxes
Postretirement health care and life insurance benefits
Industrial development bonds
Liability for uncertain tax positions
Deferred compensation and other liabilities
Total noncurrent liabilities
SHAREHOLDERS’ EQUITY:
Common stock, $.69-4/9 par value—120,000 shares authorized—
36,479 and 36,057 respectively, issued
Class B common stock, $.69-4/9 par value—40,000 shares
authorized—21,025 and 20,466 respectively, issued
Capital in excess of par value
Retained earnings, per accompanying statement
Accumulated other comprehensive loss
Treasury stock (at cost)—71 shares and 69 shares, respectively
Total shareholders’ equity
Total liabilities and shareholders’ equity
29,084
5,070
578
212,201
21,236
6,499
689
235,167
21,939
107,567
322,993
2,598
455,097
242,935
212,162
21,696
102,934
307,178
9,243
440,974
225,482
215,492
73,237
73,237
175,024
175,024
96,161
64,461
74,209
74,441
3,212
6,680
3,935
4,254
7,715
9,203
433,493
407,300
$857,856
$857,959
December 31,
2011
2010
$10,683
4,603
43,069
58,355
$9,791
4,529
44,185
58,505
43,521
26,108
7,500
8,345
48,092
133,566
47,865
20,689
7,500
9,835
46,157
132,046
25,333
25,040
14,601
14,212
533,677
114,269
(19,953)
(1,992)
665,935
$857,856
505,495
135,866
(11,213)
(1,992)
667,408
$857,959
TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
Cash Flows (in thousands)
For the year ended December
31,
2011
2010
2009
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings
$43,938
$53,063
$53,157
Adjustments to reconcile net earnings to net cash
provided by operating activities:
Depreciation
Impairment charges
Impairment of equity method investment
Loss from equity method investment
Amortization of marketable security premiums
Changes in operating assets and liabilities:
Accounts receivable
Other receivables
Inventories
Prepaid expenses and other assets
Accounts payable and accrued liabilities
Income taxes payable and deferred
Postretirement health care and life insurance
benefits
Deferred compensation and other liabilities
Others
Net cash provided by operating activities
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures
Net purchase of trading securities
Purchase of available for sale securities
Sale and maturity of available for sale securities
Net cash used in investing activities
CASH FLOWS FROM FINANCING ACTIVITIES:
Shares repurchased and retired
Dividends paid in cash
Net cash used in financing activities
19,229
—
—
194
1,267
(5,448)
3,963
(15,631)
5,106
84
(5,772)
717
(2,373)
(1,447)
4,936
2,180
2,322
17,862
14,000
4,400
233
320
(5,899)
(2,088)
455
5,203
(2,755)
(12,543)
1,429
1,384
2,146
(708)
50,390
2,525
310
82,805
2,960
305
76,994
(16,351)
(3,234)
(39,252)
7,680
(51,157)
(12,813)
(2,902)
(9,301)
8,208
(16,808)
(20,831)
(1,713)
(11,331)
17,511
(16,364)
(18,190)
(18,407)
(36,597)
(22,881)
(18,130)
(41,011)
(20,723)
(17,825)
(38,548)
(37,364)
24,986
22,082
Cash and cash equivalents at beginning of year
115,976
90,990
Cash and cash equivalents at end of year
$78,612
$115,976
Supplemental cash flow information
Income taxes paid
$16,906
$20,586
Interest paid
$38
$49
Stock dividend issued
$47,053
$46,683
(The accompanying notes are an integral part of these statements.)
68,908
$90,990
Increase (decrease) in cash and cash equivalents
2,022
18,279
—
—
342
522
$22,364
$182
$32,538
For each company calculate the following values for 2011. (Hint: When calculating free cash
flow, do not consider business acquisitions to be part of capital expenditures.) (Round all
ratios to 1 decimal places, e.g. 15.2:1 or 15.2%, earnings per share to 2 decimal
places, e.g. 15.21 and all other answers to thousands. Enter negative amounts using
either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
(1) Working capital.
Working capital
Hershe
y
Compa
ny
Tootsi
e Roll
$
$
(2) Current ratio.
Current ratio
Hershe
y
Compa
ny
:1
Tootsi
e Roll
:1
(3) Debt to assets ratio.
Debt to assets ratio
Hersh
ey
Comp
any
%
Tootsi
e Roll
%
(4) Free cash flow.
Free cash flow
Hershe
y
Compa
ny
$
$
Tootsi
e Roll
(5) Earnings per share.
Earnings per share
Hershe
y
Compa
ny
$
$
Tootsi
e Roll
Question 5
The financial statements of The Hershey Company and Tootsie Roll are presented below.
THE HERSHEY COMPANY
CONSOLIDATED STATEMENTS OF INCOME
For the years ended December 31,
2011
In thousands of dollars except per share
2010
2009
amounts
Net Sales
$6,080,788
$5,671,009 $5,298,668
Costs and Expenses:
Cost of sales
3,548,896
3,255,801
3,245,531
Selling, marketing and administrative
1,477,750
1,426,477
1,208,672
Business realignment and impairment (credits)
(886)
83,433
82,875
charges, net
Total costs and expenses
5,025,760
4,765,711
4,537,078
Income before Interest and Income Taxes
1,055,028
905,298
761,590
Interest expense, net
92,183
96,434
90,459
Income before Income Taxes
962,845
808,864
671,131
Provision for income taxes
333,883
299,065
235,137
Net Income
$628,962
$509,799
$435,994
Net Income Per Share—Basic—Class B Common
$2.58
$2.08
$1.77
Stock
Net Income Per Share—Diluted—Class B
$2.56
$2.07
$1.77
Common Stock
Net Income Per Share—Basic—Common Stock
$2.85
$2.29
$1.97
Net Income Per Share—Diluted—Common
$2.74
$2.21
$1.90
Stock
Cash Dividends Paid Per Share:
Common Stock
$1.3800
$1.2800
$1.1900
Class B Common Stock
1.2500
1.1600
1.0712
The notes to consolidated financial statements are an integral part of these statements and are
included in the Hershey's 2011 Annual Report, available at www.thehersheycompany.com.
THE HERSHEY COMPANY
CONSOLIDATED BALANCE SHEETS
December 31,
In thousands of dollars
ASSETS
Current Assets:
Cash and cash equivalents
Accounts receivable—trade
Inventories
Deferred income taxes
Prepaid expenses and other
Total current assets
Property, Plant and Equipment, Net
Goodwill
Other Intangibles
Deferred Income Taxes
Other Assets
Total assets
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current Liabilities:
Accounts payable
Accrued liabilities
Accrued income taxes
Short-term debt
Current portion of long-term debt
Total current liabilities
Long-term Debt
Other Long-term Liabilities
Total liabilities
2011
2010
$693,686
399,499
648,953
136,861
167,559
2,046,558
1,559,717
516,745
111,913
38,544
138,722
$4,412,199
$884,642
390,061
533,622
55,760
141,132
2,005,217
1,437,702
524,134
123,080
21,387
161,212
$4,272,732
$420,017
612,186
1,899
42,080
97,593
1,173,775
1,748,500
617,276
3,539,551
$410,655
593,308
9,402
24,088
261,392
1,298,845
1,541,825
494,461
3,335,131
Commitments and Contingencies
Stockholders’ Equity:
The Hershey Company Stockholders’ Equity
Preferred Stock, shares issued: none in 2011 and 2010
Common Stock, shares issued: 299,269,702 in 2011 and
299,195,325 in 2010
Class B Common Stock, shares issued: 60,632,042 in 2011 and
60,706,419 in 2010
Additional paid-in capital
Retained earnings
Treasury—Common Stock shares, at cost: 134,695,826 in 2011
and 132,871,512 in 2010
Accumulated other comprehensive loss
The Hershey Company stockholders’ equity
Noncontrolling interests in subsidiaries
Total stockholders’ equity
Total liabilities and stockholders’equity
—
—
—
—
299,269
299,195
60,632
60,706
490,817
4,699,597
434,865
4,374,718
(4,258,962)
(4,052,101)
(442,331)
849,022
23,626
872,648
$4,412,199
(215,067)
902,316
35,285
937,601
$4,272,732
THE HERSHEY COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended December 31,
2011
2010
In thousands of dollars
Cash Flows Provided from (Used by) Operating
Activities
Net income
$628,962
$509,799
Adjustments to reconcile net income to net cash
provided from operations:
Depreciation and amortization
215,763
197,116
Stock-based compensation expense, net of tax of
28,341
32,055
$15,127, $17,413 and $19,223, respectively
Excess tax benefits from stock-based compensation
(13,997)
(1,385)
Deferred income taxes
33,611
(18,654)
Gain on sale of trademark licensing rights, net of tax of
(11,072)
—
$5,962
Business realignment and impairment charges, net of
30,838
77,935
tax of $18,333, $20,635 and $38,308, respectively
Contributions to pension plans
(8,861)
(6,073)
Changes in assets and liabilities, net of effects from
business acquisitions and divestitures:
Accounts receivable—trade
(9,438)
20,329
Inventories
(115,331)
(13,910)
Accounts payable
7,860
90,434
Other assets and liabilities
(205,809)
13,777
Net Cash Provided from Operating Activities
580,867
901,423
Cash Flows Provided from (Used by) Investing
Activities
Capital additions
(323,961) (179,538)
Capitalized software additions
(23,606)
(21,949)
Proceeds from sales of property, plant and equipment
312
2,201
Proceeds from sales of trademark licensing rights
20,000
—
Business acquisitions
(5,750)
—
Net Cash (Used by) Investing Activities
(333,005) (199,286)
Cash Flows Provided from (Used by) Financing
Activities
Net change in short-term borrowings
10,834
1,156
Long-term borrowings
249,126
348,208
2009
$435,994
182,411
34,927
(4,455)
(40,578)
—
60,823
(54,457)
46,584
74,000
37,228
293,272
1,065,749
(126,324)
(19,146)
10,364
—
(15,220)
(150,326)
(458,047)
—
Repayment of long-term debt
Proceeds from lease financing agreement
Cash dividends paid
Exercise of stock options
Excess tax benefits from stock-based compensation
Contributions from noncontrolling interests in
subsidiaries
Repurchase of Common Stock
Net Cash (Used by) Financing Activities
(Decrease) Increase in Cash and Cash Equivalents
Cash and Cash Equivalents as of January 1
Cash and Cash Equivalents as of December 31
Interest Paid
Income Taxes Paid
(256,189)
47,601
(304,083)
184,411
13,997
—
(384,515)
(438,818)
(190,956)
884,642
$693,686
$97,892
292,315
(71,548)
—
(283,434)
92,033
1,385
10,199
(169,099)
(71,100)
631,037
253,605
$884,642
$97,932
350,948
(8,252)
—
(263,403)
28,318
4,455
7,322
(9,314)
(698,921)
216,502
37,103
$253,605
$91,623
252,230
TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
Earnings, Comprehensive Earnings and Retained Earnings (in thousands except per
share data)
For the year ended December 31,
2011
2010
2009
Net product sales
$528,369
$517,149
$495,592
Rental and royalty revenue
4,136
4,299
3,739
Total revenue
532,505
521,448
499,331
Product cost of goods sold
365,225
349,334
319,775
Rental and royalty cost
1,038
1,088
852
Total costs
366,263
350,422
320,627
Product gross margin
163,144
167,815
175,817
Rental and royalty gross margin
3,098
3,211
2,887
Total gross margin
166,242
171,026
178,704
Selling, marketing and administrative expenses
108,276
106,316
103,755
Impairment charges
—
—
14,000
Earnings from operations
57,966
64,710
60,949
Other income (expense), net
2,946
8,358
2,100
Earnings before income taxes
60,912
73,068
63,049
Provision for income taxes
16,974
20,005
9,892
Net earnings
$43,938
$53,063
$53,157
Net earnings
Other comprehensive earnings (loss)
Comprehensive earnings
Retained earnings at beginning of year.
Net earnings
Cash dividends
Stock dividends
Retained earnings at end of year
Earnings per share
$43,938
(8,740)
$35,198
$135,866
43,938
(18,360)
(47,175)
$114,269
$0.76
$53,063
1,183
$54,246
$53,157
2,845
$56,002
$147,687
53,063
(18,078)
(46,806)
$135,866
$144,949
53,157
(17,790)
(32,629)
$147,687
$0.90
Average Common and Class B Common shares
57,892
58,685
outstanding
(The accompanying notes are an integral part of these statements.)
CONSOLIDATED STATEMENTS OF
$0.89
59,425
Financial Position
TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIES (in thousands except per share
data)
Assets
December 31,
2011
2010
CURRENT ASSETS:
Cash and cash equivalents
$78,612
$115,976
Investments
10,895
7,996
Accounts receivable trade, less allowances of $1,731 and $1,531
41,895
37,394
Other receivables
3,391
9,961
Inventories:
Finished goods and work-in-process
42,676
35,416
Raw materials and supplies
29,084
21,236
Prepaid expenses
5,070
6,499
Deferred income taxes
578
689
Total current assets
212,201
235,167
PROPERTY, PLANT AND EQUIPMENT, at cost:
Land
21,939
21,696
Buildings
107,567
102,934
Machinery and equipment
322,993
307,178
Construction in progress
2,598
9,243
455,097
440,974
Less—Accumulated depreciation
242,935
225,482
Net property, plant and equipment
212,162
215,492
OTHER ASSETS:
Goodwill
73,237
73,237
Trademarks
175,024
175,024
Investments
96,161
64,461
Split dollar officer life insurance
74,209
74,441
Prepaid expenses
3,212
6,680
Equity method investment
3,935
4,254
Deferred income taxes
7,715
9,203
Total other assets
433,493
407,300
Total assets
$857,856
$857,959
Liabilities and Shareholders’ Equity
December 31,
2011
2010
CURRENT LIABILITIES:
Accounts payable
$10,683
$9,791
Dividends payable
4,603
4,529
Accrued liabilities
43,069
44,185
Total current liabilities
58,355
58,505
NONCURRENT LIABILITES:
Deferred income taxes
43,521
47,865
Postretirement health care and life insurance benefits
26,108
20,689
Industrial development bonds
7,500
7,500
Liability for uncertain tax positions
8,345
9,835
Deferred compensation and other liabilities
48,092
46,157
Total noncurrent liabilities
133,566
132,046
SHAREHOLDERS’ EQUITY:
Common stock, $.69-4/9 par value—120,000 shares authorized—
25,333
25,040
36,479 and 36,057 respectively, issued
Class B common stock, $.69-4/9 par value—40,000 shares
14,601
14,212
authorized—21,025 and 20,466 respectively, issued
Capital in excess of par value
533,677
505,495
Retained earnings, per accompanying statement
114,269
135,866
Accumulated other comprehensive loss
(19,953)
(11,213)
Treasury stock (at cost)—71 shares and 69 shares, respectively
Total shareholders’ equity
Total liabilities and shareholders’ equity
(1,992)
665,935
$857,856
(1,992)
667,408
$857,959
TOOTSIE ROLL INDUSTRIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
Cash Flows (in thousands)
For the year ended December
31,
2011
2010
2009
CASH FLOWS FROM OPERATING ACTIVITIES:
Net earnings
$43,938
$53,063
$53,157
Adjustments to reconcile net earnings to net cash
provided by operating activities:
Depreciation
19,229
18,279
17,862
Impairment charges
—
—
14,000
Impairment of equity method investment
—
—
4,400
Loss from equity method investment
194
342
233
Amortization of marketable security premiums
1,267
522
320
Changes in operating assets and liabilities:
Accounts receivable
(5,448)
717
(5,899)
Other receivables
3,963
(2,373)
(2,088)
Inventories
(15,631)
(1,447)
455
Prepaid expenses and other assets
5,106
4,936
5,203
Accounts payable and accrued liabilities
84
2,180
(2,755)
Income taxes payable and deferred
(5,772)
2,322
(12,543)
Postretirement health care and life insurance benefits
2,022
1,429
1,384
Deferred compensation and other liabilities
2,146
2,525
2,960
Others
(708)
310
305
Net cash provided by operating activities
50,390
82,805
76,994
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures
(16,351)
(12,813)
(20,831)
Net purchase of trading securities
(3,234)
(2,902)
(1,713)
Purchase of available for sale securities
(39,252)
(9,301)
(11,331)
Sale and maturity of available for sale securities
7,680
8,208
17,511
Net cash used in investing activities
(51,157)
(16,808)
(16,364)
CASH FLOWS FROM FINANCING ACTIVITIES:
Shares repurchased and retired
(18,190)
(22,881)
(20,723)
Dividends paid in cash
(18,407)
(18,130)
(17,825)
Net cash used in financing activities
(36,597)
(41,011)
(38,548)
Increase (decrease) in cash and cash equivalents
(37,364)
24,986
22,082
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
Supplemental cash flow information
Income taxes paid
Interest paid
Stock dividend issued
(The accompanying notes are an integral part
115,976
$78,612
90,990
$115,976
68,908
$90,990
$16,906
$20,586
$38
$49
$47,053
$46,683
of these statements.)
$22,364
$182
$32,538
Based on the information contained in these financial statements, determine the normal balance
for:
To
ots
ie
Normal Balance
Th
e
He
Normal Balance
Rol
l
Ind
ust
rie
s
rsh
ey
Co
mp
an
y
Acc
oun
( ts
1 Rec
) eiv
abl
e
Inv
(
ent
1
orie
)
s
Net
Pro
per
ty,
(
Pla
2
nt,
)
and
Equ
ipm
ent
Pro
visi
on
( for
2 Inc
) om
e
Tax
es
Acc
oun
(
ts
3
Pay
)
abl
e
Acc
rue
(
d
3
Lia
)
bilit
ies
Ret
ain
(
ed
4
Ear
)
nin
gs
Co
m
(
mo
4
n
)
Sto
ck
Net
Pro
(
duc
5
t
)
Sal
es
Int
ere
(
st
5
Exp
)
ens
e
Question 6
The following information is available for Cole Bowling Alley at December 31, 2014.
Buildings
Accounts Receivable
Prepaid Insurance
$128,800
14,520
4,680
Share Capital—Ordinary
$100,000
Retained Earnings
15,000
Accumulated Depreciation—Buildings
42,600
Cash
18,040
Accounts Payable
12,300
Equipment
62,400
Notes Payable
97,780
Land
64,000
Accumulated Depreciation—Equipment
18,720
Insurance Expense
780
Interest Payable
2,600
Depreciation Expense
7,360
Service Revenue
14,180
Interest Expense
2,600
Prepare a classified statement of financial position; assume that $13,900 of the notes payable will
be paid in 2015.(List Property, plant and equipment in order of land, buildings and
equipment. List current assets in reverse order of liquidity.)
COLE BOWLING ALLEY
Statement of Financial Position
December 31, 2014
Assets
$
$
:
$
:
$
Equity and Liabilities
$
$
$
Question 7
The Zetar plc's complete annual report, including the notes to its financial statements, is
available in the Investors section at www.zetarplc.com.
Describe in which statement each of the following items is reported, and the position in the
statement (e.g., current asset).
Acc
oun
t
Shar
(
e
a
capi
)
tal
(
Goo
b
dwill
)
Borr
owin
( gs
c and
) over
draf
ts
Amo
rtiza
tion
( of
d inta
) ngib
le
asse
ts
( Deri
e vati
) ve
Financial Statement
Position in Financial Statement
fina
ncial
asse
t