Answer:
Hot tea brews faster than iced
Explanation:
Robbie is a 20 year old dependent who is a full time student. Robbie has $6,800 in income from wages and $6,000 of interest income from bonds inherited from his grandmother. What is the amount of Robbie's Taxable Income
Answer:
$5,650
Explanation:
Calculation for What is the amount of Robbie's Taxable Income
Wages $6,800
Add Interest Income $6,000
= Adjusted Gross Income $12,800
($6,800+$6,000)
Less Standard Deduction ($7,150)
Taxable Income $5,650
($12,800-$7,150)
Therefore the amount of Robbie's Taxable Income is $5,650
During Year 3, Rex Co. introduced a new product carrying a 2-year assurance-type warranty against defects. The estimated warranty costs related to dollar sales are 2% within 12 months following sale and 4% in the second 12 months following sale. Sales and actual warranty expenditures for year ended December 31, Year 3 and Year 4, are as follows:
Year Sales Actual Warranty Expenditures
2008 $250,000 $2,250
2009 250,000 7,500
Total $500,000 $9,750
What amount should Gum report as estimated warranty liability on its December 31, 2009 balance sheet?
Answer:
the amount that should reported as the estimated liability is $20,250
Explanation:
The computation of the amount that should reported as the estimated liability is as follows:
= Total sales × total percentage - total actual warranty expenditure
= $500,000 × 6% - $9,750
= $30,000 - $9,750
= $20,250
Hence, the amount that should reported as the estimated liability is $20,250
Headland Inc. issued $4,130,000 of 11%, 10-year convertible bonds on June 1, 2020, at 98 plus accrued interest. The bonds were dated April 1, 2020, with interest payable April 1 and October 1. Bond discount is amortized semiannually on a straight-line basis. On April 1, 2021, $1,548,750 of these bonds were converted into 24,000 shares of $21 par value common stock. Accrued interest was paid in cash at the time of conversion. (a) Prepare the entry to record the interest expense at October 1, 2020. Assume that accrued interest payable was credited when the bonds were issued. (b) Prepare the entry to record the conversion on April 1, 2021. (Book value method is used.) Assume that the entry to record amortization of the bond discount and interest payment has been made.
Answer:
A. Dr Interest Payable $75,717
Dr Interest expense $154,233
Cr Discount on Bonds payable $2,800
Cr Cash $227,150
B. Dr Bonds payable $1,548,750
Cr Discount on Bonds payable $28,350
Cr Common Stock$504,000
Cr Paid-in capital in excess of par- Common Stock $1,073,100
Explanation:
(a) Preparation of the entry to record the interest expense at October 1, 2020. Assume that accrued interest payable was credited when the bonds were issued.
Dr Interest Payable $75,717
[($4,130,000*0.11)/2*(2/6)]
Dr Interest expense $154,233
[($4,130,000*.11)/2*(4/6) + $2,800]
Cr Discount on Bonds payable $2,800
($700*4)
Cr Cash $227,150
[ ( $4,130,000*.11)/2]
Calculation for the discount per month
First step is to calculate the remaining months
Months remaining= (10 years *12-2)
Months remaining=118 months
Second step is to calculate the Total discount
Total Discount=$4,130,000-($4,130,000*.98)
total discount=$4,130,000-$4,047,400
total discount=$82,600
Now let calculate the discount per month
Discount per month=($82,600/118)
Discount per month=$700
(b) Preparation of the entry to record the conversion on April 1, 2021
Dr Bonds payable $1,548,750
Cr Discount on Bonds payable $28,350
Cr Common Stock$504,000
(24,000*$21)
Cr Paid-in capital in excess of par- Common Stock $1,073,100
[$1,548,750+$28,350-($504,000)]
Calculation for Unamortized bond discount
Discount of the bonds $30,975
($82,600*(3/8))
Less Discount amortized ($2,625)
[($82,600/118)*10 years*(3/8)]
Unamortized bond discount $28,350
($30,975-$2,625)
Yi Min started an engineering firm called Min Engineering. He began
operations and completed seven transactions in May, which included his initial investment of $19,500 cash. After those seven transactions, the ledger included the following accounts with normal balances.
Cash$46,789
Office supplies 940
Prepaid insurance 4,100
Office equipment 13,500
Accounts payable 13,500
Common stock 19,500
Dividends 3,191
Engineering fees earned 43,000
Rent expense 7,480
The following seven transactions produced the account balances shown above.
A. Y. Min invested $19,500 cash in the business in exchange for common stock.
B. Paid $7,480 cash for monthly rent expense for May.
C. Paid $4,100 cash in advance the annual for insurance premium beginning the next period.
D. Purchased office supplies for $940 cash.
E. Purchased $13,500 of office equipment on credit (with accounts payable).
F. Received $43,000 cash for engineering services provided in May.
G. The company paid $3,191 cash in dividends.
Question Completion:
Prepare a trial balance for the month of May and a Cash T-account, showing the cash balance.
Answer:
Yi Min
1. Trial Balance as of May 31,
Account Details Debit Credit
Cash $46,789
Office supplies 940
Prepaid insurance 4,100
Office equipment 13,500
Accounts payable $13,500
Common stock 19,500
Dividends 3,191
Engineering fees earned 43,000
Rent expense 7,480
Totals $76,000 $76,000
2. Cash Accounts
Account Details Debit Credit
Common stock $19,500
Rent $7,480
Prepaid Insurance 4,100
Office supplies 940
Engineering fees 43,000
Dividends 3,191
Balance $46,789
Totals $62,500 $62,500
Explanation:
a) Data and Calculations:
Cash$46,789
Office supplies 940
Prepaid insurance 4,100
Office equipment 13,500
Accounts payable 13,500
Common stock 19,500
Dividends 3,191
Engineering fees earned 43,000
Rent expense 7,480
b) Yi Min's trial balance lists all the general ledger accounts (both revenue and capital) of a business at the end of May. This list is made up of the Account Titles of each nominal ledger account and the value of that ledger balance as either a debit balance or a credit balance. The two sides are expected to be in agreement, otherwise, an error in posting could have occurred.
c) The Cash account is the general ledger where all cash transactions are posted and summarized in order to determine the balance at the end of the period. It records the cash receipts and the cash payments.
Outline the process the raw ingredients for a single flavor of ice cream might undergo to get to a local grocery’s freezer case.
Answer: fermenting , shredding , pasteurizing
PCM Thermal Products uses austenitic nickel-chromium alloys to manufacture resistance heating wire. The company is considering a new annealing-drawing process to reduce costs. If the new process will cost $3.25 million dollars now, how much must be saved each year to recover the investment in 6 years at an interest rate of 15% per year
Answer:
the amount that need to be saved each year in order to recover the investment is $858,770
Explanation:
The computation of the amount saved each year is shown below:
= Costing of the new process × (A/P, 15%, 6)
= $3,250,000 × 0.26424
= $858,770
hence, the amount that need to be saved each year in order to recover the investment is $858,770
Cramer Company sold five-year, 9% bonds on October 1, 2021. The face amount of the bonds was $120,000, while the issue price was $126,000. Interest is payable on April 1 of each year. The fiscal year of Cramer Company ends on December 31. How much interest expense will Cramer Company report in its December 31, 2021, income statement (assume straight-line amortization)?
a. $2,000.
b. $1,900.
c. $1,778.
d. $2,040.
Answer:
mmmmmmmm
Explanation:
Longmire & Sons made sales on credit to Alderman Sports totaling $500,000 on April 18. The cost of the goods sold is $400,000. Longmire estimates 3% of its sales to Alderman may be returned. On May 22, $9,000 worth of goods (with a cost of $7,200) are returned by Alderman. Assume Longmire uses a perpetual inventory system.
Required:
Prepare the related journal entries for Longmire & Sons.
Answer:
April 18
Dr Account receivable 500,000
Cr Cash 500,000
April 18
Dr Cost of goods sold 400,000
Cr Merchandize inventory 400,000
May 22
Dr Sales return and allowance 9,000
Cr Account receivable 9,000
May 22
Dr Merchandize inventory 7,200
Cr Cost of goods sold 7,200
Explanation:
Preparation of the related journal entries for Longmire & Sons.
Based on the information given the related journal entries for Longmire & Sons will be :
April 18
Dr Account receivable 500,000
Cr Cash 500,000
(Being to record credit sales)
April 18
Dr Cost of goods sold 400,000
Cr Merchandize inventory 400,000
(Being to Record cost of goods sold)
May 22
Dr Sales return and allowance 9,000
Cr Account receivable 9,000
(Being to record goods return)
May 22
Dr Merchandize inventory 7,200
Cr Cost of goods sold 7,200
(Being to Record cost of goods return)
Problem 8-12 (Algo) A firm uses a serial assembly system and needs answers to the following: a. An output of 800 units per shift (8.00 hours) is desired for a new processing system. The system requires product to pass through four stations where the work content at each station is 32 seconds. What is the required cycle time for such a system
Answer:
the required time is 36 seconds
Explanation:
The computation of the required time is given below:
= Production time available ÷ desired output
= (8 hours × 60 minutes × 60 seconds) ÷ 800 units
= 28,800 ÷ 800
= 36 seconds
hence, the required time is 36 seconds
18 month rent was paid at year end how will this effect the balance sheet
Answer:
Explanation:
The correct answer to your questions is letter A. Assets will be decreased.
In the context of using information technologies for a competitive advantage, which statement is true of a top-line strategy? a. It focuses on generating new revenue by offering new products and services. b. It focuses on improving efficiency by reducing overall costs. c. It focuses on helping different market segments achieve technological advancement. d. It focuses on refining operations by using latest technologies.
Answer:
a. It focuses on generating new revenue by offering new products and services.
Explanation:
An information system or technology can be defined as a set of components or computer systems, which is used to collect, store, and process data, as well as dissemination of information, knowledge, and distribution of digital products. Thus, an information system or technology interacts with its environment by receiving data in its raw forms and information in a usable format.
Information technology is an integral part of human life because individuals, organizations, and institutions rely on information technologies in order to perform their duties, functions or tasks and to manage their operations effectively. For example, all organizations make use of information systems for supply chain management, process financial accounts, manage their workforce, and as a marketing channels to reach their customers or potential customers.
Additionally, an information system comprises of five (5) main components;
1. Hardware.
2. Software.
3. Database.
4. Human resources.
5. Telecommunications.
Hence, in the context of using information technologies for a competitive advantage over rivals in the industry, the statement which is true of a top-line strategy is that, it focuses on generating new revenue by offering new products and services. The top-line strategy ensures that the company continues to generate gross revenue or sales.
You have purchased one call option expiring in one year with a strike price of $40. The current price of the underlying is $30, the interest rate is zero, and the premium for the call option is $2.63.
1) Draw the payoff and P&L diagrams for the call option at expiration.
2) What is the P&L on the option at expiration if the underlying is $57.50 (i.e. S1 = 57.5)?
Solution :
2). Calculation of the P & L on the option at expiration if underlying price is $ 57. 50
As the underlying price is more than the exercise price, the option is exercised.
The initial cash flow = - $ 2.63
Cash flow at the expiration = $ 57.50 - $ 40
= $ 17.50
Therefore, profit = $ 17.50 - $ 2.63
= $ 15.07
1). The strike price or the exercise price = $ 40
Premium for call option = $ 2.63
On January 1, James Company reported total current assets of $658,000 and total current liabilities of $365,000. During the year, James purchased $2,000 worth of equipment for cash, paid $560 towards salaries, and borrowed $80,000 from its bank to be repaid after 5 years. How much working capital does the company have as of December 31
Answer:
$370,440
Explanation:
The computation of the working capital is as follows:
As we know that
Working capital = Current asset - current liabilities
where,
Current Assets is
= Total current assets - purchase of an equipment - salaries - borrowed amount
= $658,000 - $2,000 - $560 + $80,000
= $735,440
And, Current Liabilities is $365,000
So, the working capital is
= $735,440 - $365,000
= $370,440
Emilio’s accountant told him that if he continues to pay $50 a month on his credit card, it will take him 42 years to pay off his current balance (assuming the interest rate doesn’t change and assuming he doesn’t charge anything else on that card). His credit card interest rate is 18.99%. What is his balance?
Answer:
$3,158.40
Explanation:
The current balance on his credit card is the present value of $50 payable per month over 42-year period as shown below:
PV=monthly payment*(1-(1+r)^-n/r
PV=the unknown
montly paymet=$50
r=monthly interest rate= 18.99%/12=0.015825
n=number of monthly payments=42*12=504
PV=$50*(1-(1+0.015825)^-504/0.015825
PV=$50*(1-(1.015825)^-504/0.015825
PV=$50*(1-0.000365827)/0.015825
PV=$50*0.999634173/0.015825
PV=$3,158.40
Mortensen Industries, which uses a process-costing system, adds material at the beginning of production and incurs conversion cost evenly throughout manufacturing. The following selected information was taken from the company's accounting records: Total equivalent units of materials: 8,000 Total equivalent units of conversion: 7,240 Units started and completed during the period: 6,100 On the basis of this information, the ending work-in-process inventory's stage of completion is:
Answer:
60%
Explanation:
Calculation for what the ending work-in-process inventory's stage of completion is:
First step is to calculate the Total materials
Total equivalent units of materials + Units started and completed during the period = Total materials or 6,100 + x = 8,000; x = 1,900 (8,100-6,100)
Second step is to calculate Partial units with conversion costs in ending inventory
Using this formula
Partial units with conversion costs in ending inventory= Equivalent units of conversion –
Units started and completed during the period
Let plug in the formula
Partial units with conversion costs in ending inventory= 7,240 – 6,100
Partial units with conversion costs in ending inventory = 1,140 units
Now let calculate the ending work-in-process inventory's stage of completion
Ending work-in-process inventory's stage of completion= 1,140 ÷1,900
Ending work-in-process inventory's stage of completion=0.6*100
Ending work-in-process inventory's stage of completion= 60%
Therefore the ending work-in-process inventory's stage of completion is:60%
At December 31, Year 1, Kale Co. had the following balances in the accounts it maintains at First State Bank:
Checking account #101 $175,000
Checking account #201 (10,000)
Money market account 25,000
90-day certificate of deposit, due 2/28/Y2 50,000
180-day certificate of deposit, due 3/15/Y2 80,000
Kale classifies investments with original maturities of three months or less as cash equivalents. In its December 31, Year 1, balance sheet, what amount should Kale report as cash and cash equivalents?
Answer:
$240,000
Explanation:
The computation of the amount of cash and cash equivalent is as follows;
Amount of cash and cash equivalents is
= Money market account + 90-day certificate of deposit + Checking account for 101 - Checking account for
= $25,000 + $50,000 + ($175,000 - $10,000)
= $25,000 + $50,000 + $165,000
= $240,000
An entrepreneur recently purchased Cocoon's, a local deli, on the beach. To operate the business, she estimates that selling and administrative expenses will be $98,510.00 per year and that depreciation will be $20,000.00 per year. As part of her purchase, she took out a bank loan that will require $76,265.00 per year in interest. She anticipates paying a 32.00% tax rate on income. She estimates that the deli will attract 200.00 customers per day. Each customer will spend $12.00 on average. The cost of goods per customer will be $4.50. She will operate the deli 350.00 days per year. What is the projected net profit margin for the deli
Answer:
27%
Explanation:
The computation of the net profit margin is shown below;
As we know that
net profit margin = Net profit ÷ sales
where
net profit is
Particulars Amount
Sales (200 customers × $12 × 350 days) $840,000
Less: cost of goods sold (200 customers × $4.50 × 350 days) -$315,000
Gross profit $525,000
Less:
Selling and admin expense -$98,510
Depreciation expense - $20,000
Bank loan interest -$76,265
Net income before tax $330,225
Less tax at 32% -$105,672
Net income after tax $224,553
Now the net profit margin is
= $224,553 ÷ $840,000
= 27%
Why couldn't your friends change the amount spent on education and family care?
Answer: is this a real question ???
Explanation:
The Commonwealth of Virginia filed suit in October 2019 against Northern Timber Corporation, seeking civil penalties and injunctive relief for violations of environmental laws regulating forest conservation. When the 2020 financial statements were issued in 2021, Northern had not reached a settlement with state authorities, but legal counsel advised Northern Timber that it was probable the ultimate settlement would be $1,056,000 in penalties. The following entry was recorded:
Loss-litigation 1,650,000
Liability-litigation 1,650,000
Late in 2016, a settlement was reached with state authorities to pay a total of $1,120,000 to cover the cost of violations.
Required:
1. Prepare any journal entries related to the change.
2. Would a disclosure note be required for the change in estimate?
Answer:
Dr Liability - Litigation 530,000
Cr Gain - Litigation 530,000
Explanation:
Preparation of any journal entries related to the change.
Based on the information given journal entries related to the change will be:
Dr Liability - Litigation 530,000
Cr Gain - Litigation 530,000
(1,650,000-$1,120,000)
Which challenge leads to development of incorrect features and functionalities in IS?
A.
end user resistance
B.
quality issues
C.
lack of documentation
D.
project completion constraints
Answer:D
Explanation:
a) Calculate the PV of a perpetuity with a cash flow of $111,111 received every year. The first cash flow occurs in year 1. The interest rate is 11% simple annual rate. b) Calculate the PV of a perpetuity with a cash flow of $222,222 received every second year. The first cash flow occurs in year 2. The interest rate is 11% simple annual rate. c) Calculate the PV of a perpetuity with a cash flow of $333,333 received every third year. The first cash flow occurs in year 3. The interest rate is 11% simple annual rate.
Answer:
a) Calculate the PV of a perpetuity with a cash flow of $111,111 received every year. The first cash flow occurs in year 1. The interest rate is 11% simple annual rate.
PV of a perpetuity = annual payment / interest rate = $111,111 / 11% = $1,010,100
b) Calculate the PV of a perpetuity with a cash flow of $222,222 received every second year. The first cash flow occurs in year 2. The interest rate is 11% simple annual rate.
PV of a perpetuity = annual payment / interest rate = $222,222 / (11% x 2) = $1,010,100
c) Calculate the PV of a perpetuity with a cash flow of $333,333 received every third year. The first cash flow occurs in year 3. The interest rate is 11% simple annual rate.
PV of a perpetuity = annual payment / interest rate = $333,333 / (11% x 3) = $1,010,100
Explanation:
Since the interest rate is simple, not compounded, the three perpetuities have the same present value.
Anson Dorrance, the coach of the UNC women’s soccer team, has an eye for scouting outstanding talent for the development of his team. He makes sure to engage the best person for the position in order to develop a well-rounded team. In business language, this practice is called
Answer:
Selective hiring
Explanation:
The selective hiring means the hiring of candidates from the particular group that have some particular knowledge and skill set for the job available.
Since in the question it is mentioned that coach wants to engage the best person for the position available so this represent the selective hiring
And, the above situation represent the answer
please i need more it has to be 90 secs PLSSSSSS i need help i hate this class its college prep i beg you
passion is a docter has to be 90 sec pls
Answer:
what is the question?
Explanation:
Cash flows during the first year of operations for the Harman-Kardon Consulting Company were as follows:
Cash collected from customers, $300,000
Cash paid for rent, $32,000
Cash paid to employees for services rendered during the year, $112,000
Cash paid for utilities, $42,000
In addition, you determine that customers owed the company $52,000 at the end of the year and no bad debts were anticipated. Also, the company owed the gas and electric company $1,200 at year-end, and the rent payment was for a two-year period.
Calculate accrual net income for the year.
Answer:
Harman-Kardon Consulting Company
Calculating the Accrual Net Income:
= $164,800
Explanation:
a) Data and Calculations:
Sales Revenue:
Cash collected from customers = $300,000
Accounts receivable at year end 52,000
Total Sales Revenue = $352,000
Utilities Expense:
Cash paid for utilities = $42,000
Utilities payable 1,200
Total utilities expense $43,200
Accrual net income:
Sales revenue $352,000
Expenses:
Rent 32,000
Salaries 112,000
Utilities 43,200 (187,200)
Net income $164,800
b) Accrual net income is determined on the accrual basis of accounting. This basis takes into account all accrued expenses and revenue, all prepaid expenses and revenue received in advance, and provides for depreciation expenses, unlike the cash basis of accounting.
Determine the amount of the standard deduction for each of the following taxpayers for tax year 2020: Christina, who is single. Adrian and Carol, who are filing a joint return. Their son is blind. Peter and Elizabeth, who are married and file separate tax returns. Elizabeth will itemize her deductions. Karen, who earned $1,100 working a part-time job. She can be claimed as a dependent by her parents. Rodolfo, who is over 65 and is single. Bernard, who is a nonresident alien with U.S. income. Manuel, who is 70, and Esther, who is 63 and blind, will file a joint return. Herman, who is 75 and a qualifying widower with a dependent child.
Answer:
Christina, who is single. STANDARD DEDUCTION FOR SINGLE FILER $12,400
Adrian and Carol, who are filing a joint return. Their son is blind. STANDARD DEDUCTION FOR MARRIED FILING JOINTLY $24,800
Peter and Elizabeth, who are married and file separate tax returns. Elizabeth will itemize her deductions. PETER'S STANDARD DEDUCTION IS $12,400 (MARRIED FILING SEPARATELY), WHILE ELIZABETH DOES GET A STANDARD DEDUCTION (SHE WILL ITEMIZE)
Karen, who earned $1,100 working a part-time job. She can be claimed as a dependent by her parents. STANDARD $1,100 DEDUCTION FOR A DEPENDENT.
Rodolfo, who is over 65 and is single. STANDARD DEDUCTION OF $14,050 FOR BEING SINGLE AND OVER 65.
Bernard, who is a nonresident alien with U.S. income.
NO STANDARD DEDUCTION
Manuel, who is 70, and Esther, who is 63 and blind, will file a joint return.
STANDARD DEDUCTION FOR MARRIED FILING JOINTLY $27,400, ONE BEING OVER 65 AND THE OTHER ONE BEING BLIND
Herman, who is 75 and a qualifying widower with a dependent child.
STANDARD DEDUCTION FOR MARRIED FILING JOINTLY $26,100 (QUALIFYING WIDOWER) AND ONE BEING OVER 65
in one paragraph describe the general advantages and drawbacks of the premium pricing strategy.For exapmle, explain where it falls on the intersection of quality and price.
Please dont copy paste from the internet, will be flagged.
Answer:
The main advantage resulting from a premium pricing strategy is the higher profits. Another advantage is that customers that purchase premium products seek higher quality and tend to show higher brand loyalty associated with the status of using premium products. The disadvantages of premium pricing are that it cannot be applied to all products, the marketing efforts tend to be more specific, and therefore, represent a higher percentage of sales, and finally, not everyone is willing to pay premium prices.
A stress test in finical marketing means:_____.
A. Aims to test the behavior of historical returns and their fluctuations during all sorts of potential financial crises.
B. Does not look at historical returns, and looks at all the details of the portfolios and their vulnerabilities during all sorts of potential financial crises.
C. Tries to incorporate all potential economic and financial crises, such as recessions, appreciation and depreciation of currency, liquidity crisis, etc.
D. Tries to incorporate all the interconnections between financial institutions.
Answer:
C.
Explanation:
Stress tests are carried out to determine how financial systems would react in periods of extreme stress eg. financial or economic crisis.
Stress situations are simulated and the reaction of the financial system to the stress is measured. Based on the reactions of the financial system, steps are taken to further improve or strengthen the financial system.
The scenarios used in a stress test can be based on historical events (events that have already occurred) or hypothetical events.
Sales revenue $944,200 Less: Cost of goods sold 598,100 Gross profit 346,100 Less: Operating expenses (includes depreciation expense and bad debt expense) 248,500 Income from operations 97,600 Other revenues and expenses Gain on sale of investments $14,900 Loss on sale of equipment (2,900 ) 12,000 Income before taxes 109,600 Income taxes 45,200 Net income $64,400 (a) Compute net cash provided by operating activities under the direct method. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Net cash flow from operating activities
Answer:
$500
Explanation:
Net cash flow from operating activities is $500
The statement of cash flows shows the following information: Cash provided by operating activities of $18,200 Cash used by investing activities of $6,700 Cash used by financing activities of $1,200 The beginning cash was $17,100. What is the amount of cash at the end of the period
Answer:
$27,400
Explanation:
The amount of cash at the end of the period is calculated as;
Cash provided by operating activities
$18,200
Cash used by investing activities
($6,700)
Cash used by financing activities
($1,200)
Net increase (decrease) in cash balance
(a) $10,300
Cash at the beginning of the year
(b) $17,100
Cash at the end of the year
c = (a) + (b) = $27,400
Reese Inc., a provider of consulting services, was founded on October 1, 2022. At the end of the first month of operations, the company decided to prepare an income statement, retained earnings statement, and balance sheet using the following information. Prepare an income statement, retained earnings statement, and balance sheet. Accounts payable $ 3,300 Supplies $ 2,460 Interest expense 410 Supplies expense 380 Equipment (net) 48,200 Depreciation expense 270 Salaries and wages expense 2,500 Service revenue 20,920 Bonds payable 21,500 Salaries and wages payable 445 Unearned service revenue 4,065 Common stock 9,100 Accounts receivable 1,300 Interest payable 140 Cash 3,950 Instructions Using the information, prepare an income statement and retained earnings statement for the month of October 2022 and a balance sheet as of October 31, 2022. End. retained earnings $17,360
Answer and Explanation:
The preparation of the income statement, retained earnings, and the balance sheet is presented below:
Income statement
Service revenue $20,920
Less: expenses
Salaries & wages expense -$2,500
Interest expense -$410
Depreciation expense -$270
Supplies expense -$380
Total expense -$3,560
Net income $17,360
Retained earnings
Opening retained earnings balance $0
Add: net income $17,360
Ending retained earnings balance $17,360
Balance sheet
Assets
cash $3,950
Accounts receivable $1,300
Supplies $2,460
Equipment ,net $48,200
total assets $55,910
Liabilities and Stockholders Equity
liabilities:
Accounts payable $3,300
unearned service revenue $4,065
Salaries and wages payable $445
interest payable $140
Bonds payable $21,500
total liabilities $29,450
Stockholders equity:
Common stock $9,100
Retained earnings $17,360
total stockholders equity $26,460
total liabilities & stockholders equity $55,910