Question: Use the Classic Reserve Rare Coins CRRC data from Problem

Use the Classic Reserve Rare Coins (CRRC) data from Problem.
In Problem, Classic Reserve Rare Coins (CRRC) was formed on January 1, 2015. Additional data for the year follows:
a. On January 1, 2015, CRRC issued common stock for $ 425,000.
b. Early in January, CRRC made the following cash payments:
1. For store fixtures, $ 54,000
2. For merchandise inventory, $ 270,000
3. For rent expense on a store building, $ 10,000
c. Later in the year, CRRC purchased merchandise inventory on account for $ 243,000. Before year-end, CRRC paid $ 163,000 of this account payable.
d. During 2015, CRRC sold 2,100 units of merchandise inventory for $ 350 each. Before year-end, the company collected 80% of this amount. Cost of goods sold for the year was $ 260,000, and ending merchandise inventory totaled $ 253,000.
e. The store employs three people. The combined annual payroll is $ 94,000, of which CRRC still owes $ 4,000 at year-end.
f. At the end of the year, CRRC paid income tax of $ 23,000. There are no income taxes payable.
g. Late in 2015, CRRC paid cash dividends of $ 41,000.
h. For store fixtures, CRRC uses the straight- line depreciation method, over five years, with zero residual value.

1. Prepare CRRC’s income statement for the year ended December 31, 2015. Use the single-step format, with all revenues listed together and all expenses listed together.
2. Prepare CRRC’s balance sheet at December 31, 2015.
3. Prepare CRRC’s statement of cash flows for the year ended December 31, 2015. Format cash flows from operating activities by the direct method.

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  • CreatedJanuary 16, 2015
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