Item

2

0.83

points

Return to question

Item2

Item 2 0.83 points

Pope's Garage had the following accounts and amounts in its financial statements on December 31, 2019. Assume that all balance sheet items reflect account balances at December 31, 2019, and that all income statement items reflect activities that occurred during the year then ended.

Accounts receivable$30,700Depreciation expense11,800Land25,900Cost of goods sold87,000Retained earnings62,500Cash9,900Equipment70,500Supplies5,300Accounts payable21,600Service revenue28,300Interest expense3,100Common stock9,000Income tax expense18,564Accumulated depreciation40,000Long-term debt36,000Supplies expense13,100Merchandise inventory26,800Net sales153,000

Required:

1. Calculate the total current assets at December 31, 2019.
2. Calculate the total liabilities and stockholders' equity at December 31, 2019.
3. Calculate the earnings from operations (operating income) for the year ended December 31, 2019.
4. Calculate the net income (or loss) for the year ended December 31, 2019.
5. What was the average income tax rate for Pope's Garage for 2019?
6. If $18,000 of dividends had been declared and paid during the year, what was the January 1, 2019, balance of retained earnings?