BCO 123 ACCOUNTING II Final Task brief & rubrics Background Spark Inc is a relatively new company and you have been recruited to assist the management with advice and getting to the correct financial figures. The Final assignment will focus on and consolidate your knowledge developed in the second half of the course. It should give you an opportunity to demonstrate FULLY your knowledge and understanding. Task
You are required to do a report. This is an individual task The assignment consists of a case study which is attached below The task will cover the contents from week 5 to week 8. Please ensure your address all the points are covered in your responses Format to be submitted: A word document Include a Cover, Table of Contents, References
Formalities:
Wordcount: 1000 – 1500 words, excluding bibliography Cover, Table of Contents, References and Appendix are excluded of the total wordcount. Font: Arial 12,5 pts. Text alignment: Justified. The in-text References and the Bibliography have to be in Harvards citation style.
Submission: Week 8 Via Moodle (Turnitin). 20 September 23:59 CEST
Weight: This task is 60% of your total grade for this subject.
Tips to achieve the highest success
The answers should be clear and well presented There should be no mathematical errors, you have adequate time to do this properly. Show real understanding in any open questions. There are marks for presentation
This task assesses the following learning outcomes:
Income and changes in retained earnings : Stock splits Dividends Statement of cash flow Income statement
Rubrics
Exceptional 90-100
Good 80-89
Fair 70-79
Marginal fail 60-69
Fail <60 Knowledge (30%) Student correctly defines and describes the topics of each at all levels demonstrating a full understanding of the essay theme. Student defines and describes the topics of each key stage, demonstrating a good understanding of the essay theme (may lack a key aspect). Student makes a fair attempt at defining and describing the topics however details regarding the business in question are missing. Student makes an attempt at defining and describing the topics, however important details regarding analysis of the business in question are missing Student fails to correctly define or describe the key elements of the business in question, demonstrating a lack of understanding of the topic. Critical evaluation (30%) There is very good evidence of critical appraisal of ideas and concepts, the insights are outstanding. Evidence of critical appraisal of ideas and evaluation is good. There is some evidence of critical appraisal of ideas and concepts, but the analysis and insights are rudimentary for this level of study. There is limited evidence of critical appraisal of ideas and concepts and/or those that are offered are weak There is no critical appraisal of ideas and concepts and/or those that are offered are weak Application (30%) Applies knowledge and skills in familiar contexts with a high degree of effectiveness, providing relevant examples that support points. Applies knowledge and skills in familiar contexts with considerable effectiveness, providing some relevant examples that make a good attempt at supporting points. Applies knowledge and skills in familiar contexts with limited effectiveness, few/ irrelevant examples provided. Applies knowledge, but does so incorrectly with very weak examples. No application of knowledge. No examples are provided. Communication (10%) Uses conventions, vocabulary, and terminology of the discipline with a high effectiveness. Uses conventions, vocabulary, and terminology of the discipline with considerable effectiveness. Uses conventions, vocabulary, and terminology of the discipline with some effectiveness. Uses conventions, vocabulary, and terminology of the discipline with limited effectiveness. Work is poorly written and/or difficult to understand. QUESTION 1 (Points: 5) 1. Distinguish between a stock split and a stock dividend. Is there any reason for the difference in accounting treatment of these two events? QUESTION 2 (Points: 10) 2. Assume that when you were in high school you saved $1,000 to invest for your college education. You purchased 200 shares of Smiley Incorporated, a small but growing company. Over the three years that you have owned the stock, the corporation's board of directors has taken the following actions: Declared a 2-for-1 stock split. Declared a 20 percent stock dividend. Declared a 3-for-1 stock split. The current price of the stock is $12 per share. 2.1. Calculate the current number of shares and the market value of your investment. 2.2. Explain the likely reason the board of directors of the company has not declared a cash dividend. QUESTION 3 (Points 15) 3. Spark INC., had retained earnings at the beginning of the current year of $460,000. During the year the company earned net income of $250,000 and declared dividends as follows: $1 per share for the current-year dividend on the 10,000 shares of preferred stock outstanding. $1 per share for the dividend in arrears for one year on the 10,000 shares of preferred stock outstanding. $0.50 per share for the current-year dividend on the 200,000 shares of common stock outstanding. In addition, the company discovered an overstatement in the prior year's net income of $65,000 and corrected that error in the current year. 3.1. Prepare a statement of retained earnings for the year ended 2019 and also Write a short report on your findings. QUESTION 4 (Points 10) 4. At the beginning of the current year, Spark INC. had dividends payable of $1,600,000. During the current year, the company declared cash dividends of $4,500,000, of which $970,000 appeared as a liability at year-end. 4.1. Determine the amount of cash dividends paid during this year. QUESTION 5 (Points 30) 5. The accounting staff of Sparks INC has assembled the following information for the year ended December 31, 2019: 5.1. Prepare a statement of cash flows in the format Example below (Allison corporation) Place brackets around amounts representing cash outflows. Use the direct method of reporting cash flows from operating activities. 5.2. Some of the items above will be listed in your statement without change. However, you will have to combine certain given information to compute the amounts of 5.2.1. collections from customers, 5.2.2. cash paid to suppliers and employees, and 5.2.3. proceeds from sales of plant assets. (Hint: Not every item listed is used in preparing a statement of cash flows.) Example of a statement of cash flow format: QUESTION 6 (Points 30) 6. Comparative balance sheets report average total assets for the year of $2,575,000 and average total equity of $1,917,000 (dollar amounts in thousands, except earnings per share). Sparks INC STATEMENT OF EARNINGS FOR THE YEAR ENDING DECEMBER 31, 2019 Net Sales $4,395,253 Costs and expenses: Costs of goods sold (2,821,455) Operating expenses (1,004,396) Interest revenue 15,797 Earnings before income tax $585,199 Income tax expense (204,820) Net earnings $380,379 Earnings per share $1.70 6.1. Prepare an income statement for the year in a multiple-step format. Compute the following: 6.2. Gross profit rate, 6.3. Net income as a percentage of net sales, 6.4. Return on assets, and 6.5. Return on equity for the year. (Round computations to the nearest one-tenth of 1 percent.) 6.6. Explain why interest revenue is not included in the company's gross profit computation. ..END .
