You must complete Comprehensive Problem 4 (Part A) before completing Comprehensive Problem 4 (Part B).

Required:

1.

After all of the transactions for the year ended December 31, 20Y8, had been posted [including the transactions recorded in part (1) and all adjusting entries], the data that follow were taken from the records of Equinox Products Inc.

a. Prepare a multiple-step income statement for the year ended December 31, 20Y8. Enter all amounts as positive numbers EXCEPT in the Other revenue and expense section. In that section only, enter amounts that represent other expenses as negative numbers using a minus sign.

b. Prepare a retained earnings statement for the year ended December 31, 20Y8.*

c. Prepare a balance sheet in report form as of December 31, 20Y8. *

*	Read the instructions above each financial statement carefully. They may contain specific instructions for completing the statement.

Income Statement data:
Advertising expense	$ 150,000
Cost of goods sold	3,700,000
Delivery expense	30,000
Depreciation expense-office buildings and equipment	30,000
Depreciation expense-store buildings and equipment	100,000
Income tax expense	140,500
Interest expense	21,000
Interest revenue	30,000
Miscellaneous administrative expense	7,500
Miscellaneous selling expense	14,000
Office rent expense	50,000
Office salaries expense	170,000
Office supplies expense	10,000
Sales	5,313,000
Sales commissions	185,000
Sales salaries expense	385,000
Store supplies expense	21,000

Retained earnings and balance sheet data:

Accounts payable

$ 194,300

Accounts receivable

545,000

Accumulated depreciationoffice buildings and equipment

1,580,000

Accumulated depreciationstore buildings and equipment

4,126,000

Allowance for doubtful accounts

8,450

Bonds payable, 5%, due in 10 years

500,000

Cash

282,850

Common stock, $20 par

(400,000 shares authorized; 100,000 shares issued, 94,600 outstanding)

2,000,000

Dividends:

Cash dividends for common stock

155,120

Cash dividends for preferred stock

100,000

Goodwill

700,000

Income tax payable

44,000

Interest receivable

1,200

Inventory (December 31, 20Y8),

at lower of cost (FIFO) or market

778,000

Office buildings and equipment

4,320,000

Paid-in capital from sale of treasury stock

13,000

Excess of issue price over par:

-Common

886,800

-Preferred

150,000

Preferred 5% stock, $80 par

(30,000 shares authorized; 20,000 shares issued)

1,600,000

Premium on bonds payable

19,000

Prepaid expenses

27,400

Retained earnings, January 1, 20Y8

8,197,220

Store buildings and equipment

12,560,000

Treasury stock

(5,400 shares of common stock at cost of $33 per share)

178,200

Equinox Products, Inc.

Income Statement

1

2

3

4

5

Selling expenses:

6

7

8

9

10

11

12

13

14

Administrative expenses:

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Equinox Products, Inc.

Retained Earnings Statement

1

2

3

4

5

6

7

2.

c.

Prepare a balance sheet in report form as of December 31, 20Y8. You are not required to present the details of Preferred and Common Stock (i.e., number of shares authorized, issued and outstanding).

	Refer to the Chart of Accounts for exact wording of account titles.
	Refer to the Labels and Amount Descriptions for exact wording of text entries.
	Recall that current assets are to be reported in order of liquidity.
	Report fixed assets and paid-in capital accounts in account-number order.
	Omit the description of bonds and stocks (i.e., percentage rates, due date, number of shares, etc.)
	For those boxes in which you must enter subtracted or negative numbers use a minus sign.

Equinox Products, Inc.

Balance Sheet

1	Assets
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22	Liabilities
23
24
25
26
27
28
29
30
31
32	Stockholders Equity
33
34
35
36
37
38
39
40
41
42
43
44
45