I have attached the assignment

| October 22, 2018

Principles
of Managerial Accounting
Homework
Portfolio 2010-2011
Instructions: Please read carefully.

Your Homework Portfolio
consists of two comprehensive projects.
Each of these project will take anywhere from two to ten hours to
complete so please allow enough time for this important project. Each project is worth 50 points for a total
of 100 points. Therefore, the Homework
Portfolio counts for 25% of your grade in the course.

It is required that you
complete the Homework Portfolio on the forms provided (Microsoft Word.) If you do not have a copy of Word, you can
download a free trial from Microsoft OR use any of the computers at the college
to complete this project. My suggestion
is that you print out the project and complete it by hand (using a
pencil.) Once it is complete, you can
type it into Word.

The portfolio is designed
so you can get started as soon as you’ve read the first chapter (Statement of
Cash Flows.) DO NOT wait until the last
week of class or you’ll run out of time.

THIS PROJECT IS CONSIDERED
A TEST. YOU MAY WORK IN GROUPS TO
COMPLETE IT BUT IT IS NOT HOMEWORK AND I WILL NOT GIVE OUT ANSWERS.

I will occasionally post
check figures and hints but please do not ask me for answers. Consider it an open-book test.

Do not copy other
students’ work. You may work in groups
as long as each member is doing his or her own work and contributing to the
group.

Check your
syllabus for last day to upload to dropbox.

Financial
Statement Project

The following financial information relates to the past five
years of Titus Corporation’s operations:

Titus Corporation is happy to
announce that it has gained control of its income taxes. They have been reduced each year for several
years now. In fact, during the year 2009
income taxes have reached a five-year low of $207,852. Even better, these tax reductions have
occurred during a period in which sales have consistently grown. During the year 2009, sales reached a record
high of $3,090,646. The cost of goods
which were sold during the year was $994,024.
Operating expenses for the year 2009 were $1,195,076. Interest expense for the same period was
$175,200.

Management is particularly proud
to announce that the company has done so well that even with its strong record
of stockholder dividends and the recession it has been able to maintain its
debt service by consistently paying down its bonded indebtedness by $60,000 per
year and astoundingly even had enough profit to purchase $1,080,000 of new
equipment this year.

Some of the new programs
instituted by senior management this year include promoting a newly revised
credit policy which should keep sales strong at the company. Additionally, loss of sales from stockouts has
been virtually eliminated by a new management directive intended to maintain
more substantial inventories. Further,
selling expenses were increased to $246,716 in the year 2009. All of these decisions were intended to build
sales.

Management believes that larger
inventories will prove profitable in several ways as follows. Purchases discounts will be achieved for
purchases of large quantities of raw materials.
Interruptions in the production departments which are often caused by
uneven materials flow will be reduced or eliminated. And, as mentioned above, sales lost due to
stockouts of finished goods will be eliminated.

Inventories as of December 31 of
each year are as follows:

2009

2008

2007

2006

2005

Raw
Materials

301,090

175,745

49,067

29,612

20,933

Work In
Process

158,434

124,800

72,000

23,852

19,893

Finished
Goods

308,134

279,600

40,933

30,536

26,741

Total

767,658

580,145

162,000

84,000

67,567

Depreciation and amortization for
the year 2009 are as follows:

Building
Depreciation 1,920
Equipment
Depreciation 396,000
Patent
Amortization 24,000

There were no buildings purchased
or sold during the year 2009 but $96,000 was paid for a parcel of land. Additionally, long-term investments which had
cost Titus Corporation $60,000 were sold for $72,600.

Other December 31, 2009 asset
balances were cash $16,458, accounts receivable $1,118,589, and prepaid
expenses $27,480.

In 2009 senior management
negotiated a mortgage with a local bank in the amount of $810,000. Other liability balances at December 31, 2009
were as follows: accounts payable
$300,894, accrued operating expenses $52,861, income taxes payable $90,000, and
dividends payable $15,000. Bonds payable
have already been discussed.

No Common Stock was issued or
retired during the year 2009. Dividends
were declared and paid as follows:

2009

2008

2007

2006

2005

Cash
dividends declared

18,000

29,526

332,176

332,890

330,000

Cash
dividends paid

15,000

29,526

332,176

332,890

330,000

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Use the
preceding data to complete the following comparative Income Statement, Retained
Earnings Statement, Balance Sheet and a Statement of Cash Flows for the year
ended December 31, 2009. Use the
indirect method for the Statement of Cash Flows.

Titus
Corporation
Comparative Income Statement
For the Years Ended December 31, 2005 through 2009

2009

2008

2007

2006

2005

Sales

2,514,000

2,510,288

2,388,010

2,356,534

Cost of Goods Sold

992,534

798,041

746,057

611,452

Gross Profit

1,521,466

1,712,247

1,641,953

1,745,082

Operating Expenses:

Depreciation Expense

93,840

76,800

30,480

30,720

Patent Amortization

24,000

24,000

24,000

24,000

Selling Expenses

245,524

198,000

192,000

172,800

General Expenses

525,120

396,000

384,000

345,600

Total Operating Exp.

Income from Ops

632,982

1,017,447

1,011,473

1,171,962

Other Income:

Gain on Investment

Other Expense:

Interest Expense

36,000

34,200

30,000

27,600

Income before inc. tax

596,982

983,247

981,473

1,144,362

Income tax

256,801

333,839

348,628

377,640

Net income

340,181

649,408

632,845

766,722

Titus Corporation
Retained Earnings Statement
For the Years Ended
December 31, 2005 through 2009

2009

2008

2007

2006

2005

Retained Earnings at Beginning of
Year

2,059,721

1,742,489

1,442,534

1,005,812

Add: Net Income

340,181

649,408

632,845

766,722

Deduct: Dividends

(29,526)

(332,176)

(332,890)

(330,000)

Retained Earnings at End of Year

2,370,376

2,059,721

1,742,489

1,442,534

Titus
Corporation
Comparative
Balance Sheet
December 31, 2005 through 2009

2009

2008

2007

2006

2005

ASSETS

Cash

418,927

168,008

192,010

215,999

Accounts Receivable (Net)

252,600

284,982

138,064

58,800

Inventories

580,145

162,000

84,000

67,567

Prepaid Expenses

46,800

65,372

36,446

24,000

Long-Term Investments

89,400

90,000

90,000

90,000

Land

294,000

294,000

294,000

294,000

Buildings

1,320,000

1,471,812

1,276,850

1,049,597

Accum. Depr. Buildings

(153,840)

(72,000)

(37,200)

(25,080)

Equipment

360,000

306,000

240,000

240,000

Accum. Depr. Equipment

(144,000)

(132,000)

(90,000)

(71,640)

Patents

456,000

480,000

504,000

528,000

Total Assets

3,520,032

3,118,174

2,728,170

2,471,243

LIABILITIES & EQUITY

Accounts Payable

255,536

191,759

126,736

120,061

Accrued Operating expenses

41,160

27,702

25,763

23,186

Income Taxes Payable

87,360

82,992

77,182

69,462

Dividends Payable

12,000

12,000

12,000

12,000

Mortgage Payable

0

0

0

0

Bonds Payable

240,000

300,000

360,000

420,000

Common Stock, $100 par

360,000

300,000

240,000

240,000

Paid-in-Capital, in excess of par

153,600

144,000

144,000

144,000

Retained Earnings

2 ,370,376

2,059,721

1,742,489

1,442,534

Total Liabilities and Equity

3,520,032

3,118,174

2,728,170

2,471,243

Titus Corporation
Statement of Cash Flows
For the Year Ended December 31, 2009

Budgeting
Project

Titus Corporation’s budget director has asked you for help
in producing the following budgets for the company:

§ Sales
Budget
§ Production
Budget-Refining Division (bagged sugar)
§ Direct
Materials Budget-Refining Division (bagged sugar)
§ Cash
Budget

Anticipated quarterly sales (in units) are:

Bagged Sugar

Jawbreakers

Drink Mix

Saturn Pops

Extreme Solarpops

1st Quarter

300,000

40,000

5,000

0

0

2nd Quarter

300,000

50,000

9,850

25,000

20,000

3rd Quarter

300,000

30,000

10,000

25,000

20,000

4th Quarter

300,000

50,000

8,650

25,000

20,000

All sales are on account and 70% are collected in the
quarter in which the sale occurs. The remaining
30% are collected in the following month.

The Refining Division plans to produce enough bagged
granulated sugar that an ending inventory will exist each quarter equal to 10%
of the following quarter’s sales. The
January 1, 2010 inventory of finished goods in the Refining Division is 130,000
units. The first quarter’s sales for the
2011 year are expected to total $760,000.

The Refining Division plans to purchase enough raw materials
to have an ending inventory each quarter equal to 10% of the raw materials
needed for the following quarter. It is
anticipated that 1,900,000 pounds of raw materials will be needed in the first
quarter of the year 2011. The January 1,
2010 raw material inventory is 230,000 pounds.
Titus Corporation’s cost per pound of raw sugar is $0.20.

It is anticipated that during the first quarter of 2010
Titus Corporation will collect $200,000 from sales which occurred in the last
quarter of the year 2009.

Titus Corporation expects to pay $40,000 in dividends during
the year 2010 and they will be declared and paid in equal quarterly
installments. Also, $60,000 in bonds
payable will be retired by making equal quarterly payments during 2010. Mortgage interest of $20,250 will be paid
each quarter in the year 2010.

Quarterly cash payments for direct materials, direct labor,
overhead, selling and administrative and other costs will be:

§ 1st
Quarter $600,000
§ 2nd
Quarter $800,000
§ 3rd
Quarter $850,000
§ 4th
Quarter $900,000

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Part IComplete the budgets and schedules on the
following pages.

Titus Corporation
Sales Budget
For the Year Ended December
31, 2010

1st
Quarter

2nd
Quarter

3rdQuarter

4th
Quarter

Year’s Total

Units

Dollars

Units

Dollars

Units

Dollars

Units

Dollars

Units

Dollars

Expected Sales

Granulated Sugar 5lb. ($2.00)

Jawbreakers ($1.50 each)

Drink Mix 10lb. ($19.00)

Saturn Pops ($1.45 each)

Extreme SPs ($1.35 each)

Refining Division
Production Budget
For the Year Ended December 31, 2010
(All Figures in
Units)

1st
Quarter

2nd
Quarter

3rd Quarter

4th
Quarter

Year’s Total

Expected Sales

Desired Ending Inventory

Total Units Required

Beginning Inventory

Planned Production

Refining Division
Direct Materials
Budget
For the Year Ended December 31, 2010

1st Quarter

2nd Quarter

3rd Quarter

4th Quarter

Year’s Total

Planned Production (units)

Planned Production in lbs. @ 5
lbs. per

Desired Ending Inventory (lbs.)

Beginning Inventory (lbs.)

To be purchased (lbs.)

To be purchased (lbs. @
$0.20/lb.)

Titus Corporation
Cash Budget
For the Year Ended December 31, 2010

1st
Quarter

2nd Quarter

3rd
Quarter

4th
Quarter

Year’s Total

Beginning Cash Balance

Add Receipts:

Current Sales (70%)

Previous Sales (30%)

Total Receipts

Total Cash Available

Total Cash Disbursements:
Direct Material, Direct Labor,
Factory Overhead, Selling & Administrative Costs

And Other Costs

Dividends Paid

Mortgage Interest Paid

Bonds Payable Retired

Total Disbursements

Ending Cash Balance

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