Cango Week 3 Essay examples

700 Words Aug 18th, 2012 3 Pages
Assumptions: 1. At the beginning of 2009, CanGo purchased the online gaming company. This purchase was for cash, paid for through the proceeds of the IPO and results in goodwill. 2. 90% of the online book sales comes from JIT, the other 10% through the inventory which CanGo possesses. 100% of the CD/DVD/MP3 come through CanGo inventory. The result is that 80% of ALL sales is JIT and 20% is inventory. 3. There is one warehouse for shipping of books and one plant for manufacturing. 4. There are three divisions: a CD/DVD/MP3 division, an online gaming division and a books division. All manufacturing takes place in the CD/DVD/MP3 division. 5. The IPO took place at the beginning of 2009. 6. The CD/DVDs …show more content…
and Other Purchased Intangibles | $28,000,000 | | Less: Amortization | $(700,000) | | Net Goodwill and Other Purchased Intangibles | $27,300,000 | | | | | Total Assets | $235,900,000 | | | LIABILITIES AND OWNERS' EQUITY | Accounts Payable | $22,000,000 | | Accrued Advertising | $11,800,000 | | Other Liabilities and Accrued Expense | $1,400,000 | | Current Portion of Long-Term Debt | $2,300,000 | | | | | Long Term Debt | $57,400,000 | | | | | Preferred Stock, $100 par value per share, | | | 100,000 authorized, 0 shares issued and outstanding | $0 | | | | | Common Stock, $1 par value per share, | | | 250,000,000 shares authorized, 13,000,000 shares | | | issued, 12,900,000 outstanding | $13,000,000 | | | | | Additional Paid-in-Capital in excess of par value, Common Stock | $117,000,000 | | | | | Treasury Stock | $(1,000,000) | | | | | Retained Earnings (less Cash Dividends Paid) | $12,000,000 | $11,000,000 | | | | Total Liabilities and Owner's Equity | $235,900,000 | |

Income Statement | December 31, 2009 | December 31, 2008 | Sales Revenues | $51,000,000 | $10,300,000 | Less: Sales Returns | $(1,000,000) | $(300,000) | Net Sales Revenues | $50,000,000 | $10,000,000 | Less: Cost of Goods Sold | $(9,000,000) | $(4,000,000) | Gross Profit | $41,000,000 | $6,000,000 | | | | Operating Expenses: |

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