Hello Michael, Can you also help with this assignment? I have another that I will email below .Thank You,Benjamin O’Henry has owned and operated O’Henry’s Data Services since its beginning ten years ago. From all appearances, the business has prospered. In the past few years, you have become friends with O’Henry and his wife. Recently, O’Henry mentioned that he has lost his zest for the business and would consider selling it for the right price. You are interested in buying this business, and you obtain its most recent monthly unadjusted trial balance which follows:O’Henry’s Data Services Unadjusted Trial Balance November 30, 20XX$15,600 3,800 6,700 137,400 14,300 Total…………………………………………. $177,800 $177,800 Revenues and expenses vary little from month to month, and November is a typical month. Your investigation reveals that the unadjusted trial balance does not include the effects of monthly revenues of $2,100 and monthly expenses totaling $2,750. If you were to buy O’Henry’s Data Services, you would hire a manager who would require a monthly salary of $3,000.The most you would pay for the business is 20 times the monthly net income you could expect to earn from it. Compute this possible price. The least O’Henry will take for the business is his ending capital. Compute this amount. Under these conditions, how much should you offer O’Henry? Give your reason.Please submit your assignment.Objective: •Prepare an Income Statement, Owner’s Equity Statement, and Balance Sheet.In the O’Henry assignment you must create an income statement and a statement of owners equity (do not create a balance sheet). Please use Chapter 3 page 148-151 of the text as a guide to help you build your income statement and statement of owners equityFirst, you need to create an income statement for the buyer. You need this for 2 reasons; (1) to determine the monthly net income you would pay (times 20) for the business, and (2) the net income figure needs to be “closed out” and “turned into” retained earnings which are part of the calculation for ending capital (a.k.a., owners equity). Look at the text, to determine what accounts go on the income statement (revenue and expenses only, please). Then take the net income figure multiplied by 20 to determine the amount the buyer is willing to pay for O’Henry’s business. REMEMBER, the buyer needs a manager, so the cost of the manager needs to be included in the income statement as well as the monthly revenue and expense figures discussed in the narrative of the assignment.Next you need to determine how much O’Henry wants for the business. The least O’Henry will take is his ending capital. Capital (or owners equity) is calculated as follows: beginning capital (owners equity) plus retained earnings less any withdrawals or dividends = ending capital (or owners equity). REMEMBER that the net income figure you use to calculate how much O’Henry wants for the business should not include the cost of the manager, since O’Henry does not need the manager.You must show your calculations. If you simply provide O’Henry’s asking price and the buyers offer figures without showing your calculations you will not receive any points for this assignment, even if your figures are correct!In any business transaction you can negotiate the price. Finally, make sure you remember to discuss how much should you offer O’Henry and give your reason. By the way, did you know that we specifically address issues in the IP and DB and discuss how concepts in the chapters tie into the assignments in our weekly live chats? Join us and see ?******************************** 2nd Assignment*******************************The net income of Simon and Hobbs, a department store, decreased sharply during 2000. Carol Simon, owner of the store, anticipates the need for a bank loan in 2001. Late in 2000, Simon instructs the store’s accountant to record a $10,000 sale of furniture to the Simon family, even though the goods will not be shipped from the manufacturer until January 2001. Simon also tells the accountant not to make the following December 31, 2000 adjusting entries:•Salaries owed to employees: $900•Prepaid insurance that has expired: $400Why is Simon taking this action? Is her action ethical? Give your reason, identifying the parties helped and the parties harmed by Simon’s action.In your own words, please post a response to the Discussion Board and comment on other postings. You will be graded on the quality of your postings.Objective: •Analyze the effect of business transactions on the basic accounting equation.Instructor Comments: Make sure you consider this situation from all angles; Simon’s responsibility to the employees, Simon’s responsibility to the bankers, etc. Then take this one step further and do a little investigation. What principle of GAAP is Carol violating, is she breaking any laws (look at Sarbanes-Oxley act of 2002)?In order to be awarded 50 points (a grade of ‘C’) students should answer the discussion board question fully and intelligently. To earn 70 points (a high A), the student must: provide additional information to the discussion that would be informative; elaborate and expand on previous comments from others; present explanations of concepts or methods to help fellow students; present reasons for or against a topic in a persuasive fashion; share your own personal experiences that relate to the topic; share a URL website with other students and explanation for an area you researched on the Internet. Through out the week I post additional, optional questions which give students another opportunity to demonstrate their knowledge. Answering the additional questions posted is not required. This time you may want to consider taking and defending a view contrary to the overall opinion of the other students. Remember that due to the interactive nature of the DB, late submission will not be accepted under any circumstance. Can you defend Carol’s actions? Remember that sometimes in these discussions there is no right or wrong answer, just how well you can defend your position!
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