During 2014, Schubert Inc. earned revenues of $19 million from the sale of its products. Schubert ended the year with net income of $4 million. Schubert collected cash of $20 million from customers.
Answer these questions about Schubert's operating results, financial position, and cash flows during 2014:
1. How much were Schubert's total expenses? Show your work.
2. Identify all the items that Schubert will report on its income statement for 2014. Show each amount.
3. Schubert began 2014 with receivables of $6 million. All sales are on account. What was Schubert's receivables balance at the end of 2014? Identify the appropriate financial statement and show how Schubert will report its ending receivables balance in the company's 2014 annual report.
4. Schubert began 2014 owing accounts payable of $9 million. Schubert incurs all expenses on account. During 2014, Schubert paid $18 million on account. How much in accounts payable did Schubert owe at the end of 2014? Identify the appropriate financial statement and show how Schubert will report these accounts payable in its 2014 annual report.