Financial Analysis II
Financial Analysis II ABM 122
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This 4 page Class Notes was uploaded by Don Langworth DVM on Thursday October 15, 2015. The Class Notes belongs to ABM 122 at Morgan Community College taught by Staff in Fall. Since its upload, it has received 12 views. For similar materials see /class/223565/abm-122-morgan-community-college in General at Morgan Community College.
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Date Created: 10/15/15
Accrual Balance Sheet Exercise 7 End of Period Page 1 Accrual Balance Sheet Exercise 1231 End of Period 1 Objective 1 This unit is designed to give students practical experience in building a spreadsheet based accrual basis balance sheet This unit will enhance the student s understanding of why such balance sheets are essential to the financial success of the business Students are expected to think critically about the balance sheet they construct and identify potential aws or omissions in the information 11 Materials needed 1 List of Assets and Liabilities see below 2 Spreadsheet software If you do not have Microsoft Excel software contact your instructor for alternate spreadsheet files to work with the spreadsheet software you do have In rare instances you may have to do the work manually on paper rather than using spreadsheet software 3 Amortization software Your spreadsheet software may provide an amortization template or wizard You can also use the Amortizexls template from the Curriculum CDROM or download it from the following web site wwwmorgancceduabmcurricsgcert2ABM7121U1 If you are continuing this exercise from the beginning of period exercise you should have already created the amortization schedules 4 Balance Sheet Template You can access the template provided by MCC at the following web address wwwmorgancceduabmcurricsgcert2ABM7122U1 or on the curriculum CDROM If you are presently using a different spreadsheet balance sheet template you may use that template format but you should to clear it with your instructor for this class first Lastly if you would rather use a different format than that provided you may do an lntemet search to find a more suitable balance sheet template If you are continuing from the beginning of period exercise you should be able to open the existing balance sheet and make the adjustments that make it correct for the end of the year 111 Instructions 1 Place the following list of assets and liabilities into the correct location of the accrual basis balance sheet You will have to calculate accrued interest on some loans and will need to create amortization schedules in Accrual Balance Sheet Exercise 4 End of Period Page 2 order to indicate the principal portion due within 12 months for the loans 2 Save the balance sheet under a different name 3 Print the balance sheet for your records 4 Complete the Critical Thinking Exercise for the beginning of the period accrual balance sheet 5 Send a copy of the balance sheet to your instructor by email If email is unavailable send it on paper List of Assets and Liabilities 1231 end of period ltem Item Description Amount Special Notes Additional information other amounts 1 Cash Checking amp Savings 750 2 Inventory for Sale Livestock 29900 52 Calves 575 3 Stock in Cooperative 1000 Farm Credit Services 4 Individual Retirement Account 2000 Original cost was 1500 5 Real Estate Loan 80147 30 year loan originally for 100000 Loan was amortized at 975 Year 15 payment was made on Nov 30m the regularly scheduled payment date 6 Principal Due on Real Estate loan in Use the amortization schedule to the next year determine the principal to pay on next payment Round to nearest dollar 7 Accrued interest payable on real Calculate the interest that has estate loan accrued on the loan Round to nearest dollar 8 Real estate 128000 Originally cost 80000 and with 0 market depreciation value 9 Tractor 22500 Originally cost 35000 and has market 13000 accumulated depreciation value 10 Tillage Equipment 1500 Cost 2000 and accumulated depr market is 2000 value 11 Pickup Truck 2500 Cost of 12000 depreciation of market value 12000 Accrual Balance Sheet Exercise 7 End of Period Page 3 market 2000 value term note out is 925 81111 note per acre was Market was 240 value estate tax new year year out company fixed interest rate of 9 First payment will be made on April 30 h next tractor use to calculate an amortization schedule on tractor many have accrued since the loan was taken out Calculate the interest due en cows year taken out on 1031 and 151 pmt due 1031 next Accrual Balance Sheet Exercise 7 End of Period Page 4 32 Principal due in 12 months on cow Make amortization schedule using note info above 33 Accrued interest payable 0 cow note How many months at What interest rate
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