Question

need answers to questions 1-4

Me 9Search ACC111 GroupProjectilnstructions_V1a.docx - Saved Help View Review Mailings References Layout AaBbCcD AaBbCcDx AaBbi AaBbCcC AaB A 1 Normal 1 No Spac. Heading 1 Heading 2 A A Aa- Ap Title A-D- A- Styles Paragraph Group Project 1 Let's examine a case using Sal's Silly Song Corporation and Greg's Tunes Corporation. It is now the end of the first year of operations and both company's want to know how well they came out at the end of the year. Neither business kept complete accounting records. There were no dividends paid out by either corporation. Assume that the Stockholders' Equity given includes only the initial investment made by each corporation's shareholders. The following is the financial information supplied by the two companies at year end. Sal's Silly Song Corporation $23,000 $8,000 $35,000 $22,000 Total Assets Stockholders' Equity Total Revenues Total Expenses Greg's Tunes Corporation Total Liabilities Stockholders' Equity Total Expenses Net Income $10,000 $6,000 $44,000 $9,000 Sal and Greg were the sole owners of their respective corporations. Greg has forgotten all the accounting he learned in college Sal majored in English literature, so she never learned any accounting. To gain information for evaluating their businesses, they ask you several questions. For each answer you must show your work to convince the two companies that you know what you are talking about Answer each auestion including comnutations on the workinn naner file nrovided Focus HEWLETT-PACKARD

Answer 1

Answers for each question is attached as a handwritten images.

() which business has mole Assets? Sal's Silly Song Corporation Total Assets - $23.000 Greg's Tunes Corporation Compelation of total Assets I tiabilities Amant Assets Amant Stock holders Equity 6,000 Total liabilities 10,000 Total Assets 125,000 Profets 9,000 Balonary figne): 125,000 25,00 Therefse, Greg's Tunes Corporation has mle Assets. (8) which business owes more Creditors. Gregs Tunes Corporations has to owes amanting 1 $10,000 to Creditos Sal's Silly song coperation Calculation of Creditifs. Liabilities Amont Assets Amant Stock holders Cauty 8,000 Assets £23,000 profit (Revenue - Experise) (35,00-22,000) 113,000 Creditos 2,000 (Balancing fgure) 28,000 ! 23,000 Therese Sat's Greg's Tine corporation has owes mole to creditors

(3) Stock holder's Equity : Sal's silly Song coporation Stuck Holders Erudy = $8,000 Add: Profit Earned $13,000 $ 24,000 Profet Earned - Total Revenue - Total Expene 5 $35,000 - $22,00 - $13,000. Gregs Tunes coplation Stock Holders Equity = $6,000 Add Net Income = $9,000 $ 15,000 Therefore, Sal's silly Song Cepration has moe Stockholders Equity. (4) Revenue Sal's silly Song Corporation Revenue Earned - $25,000 Greg's Tune Corporation. Het Income - Total Expense - - Net Income - Total Revenue - Total Expense 9,000 - Total Revenue - 44000 Total Revenue = $53,000 Therefse, greg's tune Corporation has more Revenue.

( More profitable Sal's Silly Song Corporation Total Revenue = $35,000 Total Expense = $22,000 Net Income - 13,000 Greg's Net Tone Income Corporation = $9,000 Therefore, sal's silly sing Corporation I because it has nie net home i has is more profitable. (6) The most important to Evaluating the two businesses is stockholders Equity because . is stockholders Equity is more the Company has mre profits and Can Sustain and also continue its business operations in the future () from a financial standpoint business of Sal's Silly Song Corporation is better because for the following reasons. (as it has to one less to Creditos. (6) if has more net income 6 it has moe stockholder's Equity.