Your company prepared the alphabetical trial balance on the following page (adjusting entries for the end...

  
 

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Your company prepared the alphabetical trial balance on the following page (adjusting entries for the end of the year have already been made) as of December 31, 2020 (last year): DEBITS CREDITS $73,700 Accounts Payable Accounts Receivable Accumulated Depreciation - Equipment Allowance for Doubtful Accounts Amortization Expense Available for Sale Securities Bad Debts Expense $52,170 199,640 6,870 6,000 48,000 9,900 Bonds Payable (due November 1, 2024) 300,000 Cash Cash Dividend Declared Common Stock, S10 par, 80,000 shares authorized, ? shares issued) Copyright Cost of Goods Sold (perpetual inventory) Depreciation Expense Discount on Bonds Payable Equipment Gain on Sale of Assets Income Tax Expense Income Tax Payable Insurance Expense Interest Expense Interest Payable Loss from Sale of Assets 21,810 30,000 120,000 54,000 742,410 82,530 16,200 945,170 15,000 ??? ??? 61,200 27,000 4,000 28,150 140,520 Merchandise Inventory Paid in Capital in Excess of Par - Common Prepaid Insurance Retained Earnings, January 1 Rent Expense Sales Utilities Expense Wages Expenses Wages Payable TOTAL 214,470 8,000 163,700 46,000 1,586,590 8,850 288,020 6.960 $2,690,930 $2,690,930 INSTRUCTIONS: Based upon the list of accounts and balances above, use a computer spread- sheet to prepare the FORMAL muitiple step income statement (including earnings per share, assuming that the only stock transaction for the year was selling 600 shares of common stock on October 1, 2020, and there are no items which require the calculation of diluted earnings per share), retained earnings statement, and classified balance sheet for your company for the year ended December 31, 2020. Assume a flat 30% tax rate on all items. Report all amounts on financial statements to the nearest dollar but report earnings per share to the nearest penny. You do not have to prepare a cash flow statement for this assignment, but you will be doing one in future assignments. Your company completed the following summarized transactions and adjusting entries which occurred in 2021 for your company (continuation from Computer Problem #1): a. Purchased merchandise for $780,600 on account. Assume a perpetual inventory system. b. Sold merchandise for $1,663,200. Of the total sales, 60% were on account. Assume a FIFO flow of inventory which included all of last year's inventory and 80% of this year's purchases (in transaction "a."). c. Collected $943,874 of accounts receivable. d. Wrote off $8,205 of old, past due accounts receivable. Sold 3,000 shares of common stock on April 1, 2021, for $32.00 per share in cash. f. Paid off $718,257 of accounts payable. е. g. Paid $34,258 for advertising for this year. h. Paid wages of $294,287 during the year. This amount included the wages owed at the end of 2020. i. Bought stock in Excellent Company for $9,500 in cash. Your company has no plans to sell the shares of stock in the next few years. j. Paid utilities of $86,374 during the year. k. Paid $16,000 for a patent. 1. Paid $39,100 of rent throughout the year. m. Sold equipment for $13,586 in cash. The equipment originally cost $51,050 and had a book value of $14,110 at the time of the sale. n. Paid $24,000 of interest on the bonds payable. This amount included the interest owed at the end of 2020. o. Paid income taxes for 2020 (last year). p. Paid $62,580 for insurance. q. Declared a $2.00 per share cash dividend for the common stockholders on December 1, 2021, (based upon the number of shares outstanding on December 1). The dividends were paid on December 19, 2021. Information for Adjusting Journal Entries for December 31, 2021: 1. Recorded $84,943 of depreciation on the equipment. s. Amortized $6,000 of the copyright and $2,000 of the patent. Estimated bad debts as one half of one percent of gross sales. u. Accrued wages of $3,829 on December 31. t. Amortized $3,800 of the discount on bonds payable. f the o V. w. Of the insurance paid in part "p." on the previous page, $8,600 is for 2022 (NEXT year). x. Accrued $4,000 of interest on the bonds payable y. Estimated income taxes for the year of 2021. Assume a newly enacted 32% income tax rate for this year on all items. You will have to prepare the income statement for 2021 in order to determine the amount of income tax. INSTRUCTIONS 1. Prepare entries in general journal form for each of the transactions on the previous page and for the adjusting entries above. Just use the letter (a, b, c, etc.) to represent the date of the transaction. Prepare the formal COMPARATIVE multiple step income statements for your company for 2020 and 2021 in side by side columns, including earnings per share. On these comparative financial statements, you should report one set of account titles but two sets of dollar amounts in side-by-side columns. Amounts on the income statement should be 2. rounded to the nearest dollar (except earnings per share which should be rounded to the nearest penny = TWwo decimals). Your company prepared the alphabetical trial balance on the following page (adjusting entries for the end of the year have already been made) as of December 31, 2020 (last year): DEBITS CREDITS $73,700 Accounts Payable Accounts Receivable Accumulated Depreciation - Equipment Allowance for Doubtful Accounts Amortization Expense Available for Sale Securities Bad Debts Expense $52,170 199,640 6,870 6,000 48,000 9,900 Bonds Payable (due November 1, 2024) 300,000 Cash Cash Dividend Declared Common Stock, S10 par, 80,000 shares authorized, ? shares issued) Copyright Cost of Goods Sold (perpetual inventory) Depreciation Expense Discount on Bonds Payable Equipment Gain on Sale of Assets Income Tax Expense Income Tax Payable Insurance Expense Interest Expense Interest Payable Loss from Sale of Assets 21,810 30,000 120,000 54,000 742,410 82,530 16,200 945,170 15,000 ??? ??? 61,200 27,000 4,000 28,150 140,520 Merchandise Inventory Paid in Capital in Excess of Par - Common Prepaid Insurance Retained Earnings, January 1 Rent Expense Sales Utilities Expense Wages Expenses Wages Payable TOTAL 214,470 8,000 163,700 46,000 1,586,590 8,850 288,020 6.960 $2,690,930 $2,690,930 INSTRUCTIONS: Based upon the list of accounts and balances above, use a computer spread- sheet to prepare the FORMAL muitiple step income statement (including earnings per share, assuming that the only stock transaction for the year was selling 600 shares of common stock on October 1, 2020, and there are no items which require the calculation of diluted earnings per share), retained earnings statement, and classified balance sheet for your company for the year ended December 31, 2020. Assume a flat 30% tax rate on all items. Report all amounts on financial statements to the nearest dollar but report earnings per share to the nearest penny. You do not have to prepare a cash flow statement for this assignment, but you will be doing one in future assignments. Your company completed the following summarized transactions and adjusting entries which occurred in 2021 for your company (continuation from Computer Problem #1): a. Purchased merchandise for $780,600 on account. Assume a perpetual inventory system. b. Sold merchandise for $1,663,200. Of the total sales, 60% were on account. Assume a FIFO flow of inventory which included all of last year's inventory and 80% of this year's purchases (in transaction "a."). c. Collected $943,874 of accounts receivable. d. Wrote off $8,205 of old, past due accounts receivable. Sold 3,000 shares of common stock on April 1, 2021, for $32.00 per share in cash. f. Paid off $718,257 of accounts payable. е. g. Paid $34,258 for advertising for this year. h. Paid wages of $294,287 during the year. This amount included the wages owed at the end of 2020. i. Bought stock in Excellent Company for $9,500 in cash. Your company has no plans to sell the shares of stock in the next few years. j. Paid utilities of $86,374 during the year. k. Paid $16,000 for a patent. 1. Paid $39,100 of rent throughout the year. m. Sold equipment for $13,586 in cash. The equipment originally cost $51,050 and had a book value of $14,110 at the time of the sale. n. Paid $24,000 of interest on the bonds payable. This amount included the interest owed at the end of 2020. o. Paid income taxes for 2020 (last year). p. Paid $62,580 for insurance. q. Declared a $2.00 per share cash dividend for the common stockholders on December 1, 2021, (based upon the number of shares outstanding on December 1). The dividends were paid on December 19, 2021. Information for Adjusting Journal Entries for December 31, 2021: 1. Recorded $84,943 of depreciation on the equipment. s. Amortized $6,000 of the copyright and $2,000 of the patent. Estimated bad debts as one half of one percent of gross sales. u. Accrued wages of $3,829 on December 31. t. Amortized $3,800 of the discount on bonds payable. f the o V. w. Of the insurance paid in part "p." on the previous page, $8,600 is for 2022 (NEXT year). x. Accrued $4,000 of interest on the bonds payable y. Estimated income taxes for the year of 2021. Assume a newly enacted 32% income tax rate for this year on all items. You will have to prepare the income statement for 2021 in order to determine the amount of income tax. INSTRUCTIONS 1. Prepare entries in general journal form for each of the transactions on the previous page and for the adjusting entries above. Just use the letter (a, b, c, etc.) to represent the date of the transaction. Prepare the formal COMPARATIVE multiple step income statements for your company for 2020 and 2021 in side by side columns, including earnings per share. On these comparative financial statements, you should report one set of account titles but two sets of dollar amounts in side-by-side columns. Amounts on the income statement should be 2. rounded to the nearest dollar (except earnings per share which should be rounded to the nearest penny = TWwo decimals).

Answer rating: 100% (QA)

Serial no Particulars Debit Credit a Purchase account Accounts payable 780600 780600 b Cash account Account receivable Sales account 665280 997920 166... View the full answer