Question

Accounting i Spreadsheet Assignman Name sheet Assignment Portion of In-Class Writing Activity Date COMPANY: TIME TO PLAY, INC. You are a member of top management of Time To Play In t er of modela planasThe firm anginally operated as a sole proprietorship, but recently changed to the corporate form in hopes of expanding operations by generating additional financing from the sale of common stock You and other top managers will be meeting next week with the firm's new Board of Directors to provide background information on the business and detail its profitability since its inception in 2017 You just got off the phone with the firm's o r che accountant), Randi Hunter, who was on her way to a hospital for treatment of her worsenina pneumonia Could you determine the profitability information for the Chief Executive Officer (CEO) Galen Carter, who will be making the presentation to the Board of Directors? Because you thoroughly enjoyed the accounting courses you took in college you remember much about profitability determination and feel confident in your ability to help out Because of competition, the company has had to drop selling prices. The selling price per unit was 56.85 in 2017. 5875 in 2015 and 56 70 in 2019. Then there is the issue of product costs versus period expenses There has not been much inflation the past few year so product costs as opposed to period expenses) have been stable Searching through files in Randi's office, you find that since 2017 Time To Play, Inc has had the following manufactured cost per unit for all three voor Direct Materials Per Unit 1 to Direct Labor Par Unit Overhead Applied Por Unit 2.35 Indition the firm incurred selling and administrative costs that are considered period expenses mencal data can be summarized as follows Selling and Bere Manufactured Units sold Units Endine Admin Expenses 118,000 18.000 $ 52,000 290,000 56.000 $106.800 320,000 1 14.000 $127.600 new comparation will have to pay income taxes on the income it The proponit was for those three years did not because sole proprietorship port the income on the personal tax returns) Finally, you remind yourself that to pent you w ave to com e difference between axed and unexpired costs REQUIRED Prepare a spreadsheet with appropriate INPUT and OUTPUT sections the a tes a number of units sold each year (for 2017, 2018, and 2019) formal multiple-step income statement for each year (be sure it also ated cost of goods sold section) and (c) calculate trend (or horizontal) of w in sales and in net income from the base year of 2017

this is the format for income statement

Answer 1

Answer to a)

Yr	Sales Price	Opg I/o	Production	Sales	Clg Inventory	S&D Expenses
		(A)	(B)	(A+B-D)	(D)
2017	6.85	-	1,18,000	1,00,000	18,000	52,000
2018	6.75	18,000	2,90,000	2,42,000	66,000	1,06,800
2019	6.70	66,000	3,20,000	2,72,000	1,14,000	1,27,600

Answer to b)

	Income statement for 3 years
Particulars		2017		2018		2019
Sales		6,85,000		16,33,500		18,22,400
Less: Cost of Goods Sold
Opening Inventory	-		64,800		2,37,600
Add: Cost of Goods Mfg (Units Produced* Cost p.u.)	4,24,800		10,44,000		11,52,000
Less: Closing Inventory	64,800		2,37,600		4,10,400
Net Cost of Goods Sold		3,60,000		8,71,200		9,79,200
Gross Profit		3,25,000		7,62,300		8,43,200
Less: Selling Costs		-52,000		-1,06,800		-1,27,600
Income before taxes		2,73,000		6,55,500		7,15,600
Less: Taxes		-81,900		-1,96,650		-2,14,680
Net income after taxes		1,91,100		4,58,850		5,00,920

Answer to c)

Trend Graph: Sales - Profit Trend 2000000 1800000 1600000 1400000 1200000 1000000 800000 600000 400000 200000 2 - Year Sales Profit