Zambrano Wholesale Corporation maintains its records on a cash basis. At the end of each year...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Zambrano Wholesale Corporation maintains its records on a cash basis. At the end of each year the company's accountant obtains the necessary information to prepare accrual basis financial statements. The following cash flows occurred during the year ended December 31, 2024: Cash receipts: $ From customers 695,000 Interest on note 4,860 Loan from a local bank 120,000 $ Total cash receipts 819,860 Cash disbursements: $ Purchase of inventory 394,000 Annual insurance payment 6,480 Payment of salaries 214,000 Dividends paid to 11,000 shareholders Annual rent payment 26,000 $ Total cash disbursements 651,480 Selected balance sheet information: 12/31/2023 12/31/2024 Cash $27,000 $ 195,380 Accounts receivable 64,000 96,000 Inventory Prepaid insurance 84,000 64,000 2,900 ? Prepaid rent 11,400 ? Interest receivable 3,645 ? Note receivable 54,000 54,000 Equipment 120,000 120,000 Accumulated depreciation (42,000) (54,000) Accounts payable (for inventory) 112,000 126,000 Salaries payable 20,400 24,800 Notes payable 0 120,000 Interest payable 0 ? Additional information: 1. On March 31, 2023, Zambrano lent a customer $54,000. Interest at 9% is payable annually on each March 31. Principal is due in 2027. 2. The annual insurance payment is paid in advance on April 30. The policy period begins on May 1. 3. On October 31, 2024, Zambrano borrowed $120,000 from a local bank and signed a note promising repayment. Principal and interest at 6% are due on October 31, 2025. 4. Annual rent on the company's facilities is paid in advance on June 30. The rental period begins on July 1. Required: 1. Prepare an accrual basis income statement for 2024 (ignore income taxes). 2. Determine the following balance sheet amounts on December 31, 2024: Zambrano Wholesale Corporation maintains its records on a cash basis. At the end of each year the company's accountant obtains the necessary information to prepare accrual basis financial statements. The following cash flows occurred during the year ended December 31, 2024: Cash receipts: $ From customers 695,000 Interest on note 4,860 Loan from a local bank 120,000 $ Total cash receipts 819,860 Cash disbursements: $ Purchase of inventory 394,000 Annual insurance payment 6,480 Payment of salaries 214,000 Dividends paid to 11,000 shareholders Annual rent payment 26,000 $ Total cash disbursements 651,480 Selected balance sheet information: 12/31/2023 12/31/2024 Cash $27,000 $ 195,380 Accounts receivable 64,000 96,000 Inventory Prepaid insurance 84,000 64,000 2,900 ? Prepaid rent 11,400 ? Interest receivable 3,645 ? Note receivable 54,000 54,000 Equipment 120,000 120,000 Accumulated depreciation (42,000) (54,000) Accounts payable (for inventory) 112,000 126,000 Salaries payable 20,400 24,800 Notes payable 0 120,000 Interest payable 0 ? Additional information: 1. On March 31, 2023, Zambrano lent a customer $54,000. Interest at 9% is payable annually on each March 31. Principal is due in 2027. 2. The annual insurance payment is paid in advance on April 30. The policy period begins on May 1. 3. On October 31, 2024, Zambrano borrowed $120,000 from a local bank and signed a note promising repayment. Principal and interest at 6% are due on October 31, 2025. 4. Annual rent on the company's facilities is paid in advance on June 30. The rental period begins on July 1. Required: 1. Prepare an accrual basis income statement for 2024 (ignore income taxes). 2. Determine the following balance sheet amounts on December 31, 2024:
Expert Answer:
Related Book For
Intermediate Accounting
ISBN: 9781259722660
9th Edition
Authors: J. David Spiceland, James Sepe, Mark Nelson, Wayne Thomas
Posted Date:
Students also viewed these accounting questions
-
Refer to Exercise 13.69. a. Give the implied regression line of pulse- rate difference on height and weight for a smoker who did not run in place and who has engaged in little physical activity. b....
-
Make an online poster on, Applications of "Plant tissue culture". Make it in Power-point slide. It should also includes, pictorial representations for Various applications of Plant tissue culture and...
-
Complete the following table of basic calculations. For Percent Contribution Margin, use (P-MC)/P. Round to table standard. Price 18 17 16 15 14 13 j Quantity Demanded 600 a 800 900 1000 1100 1200...
-
Give an example where (f (x) + g(x)) exists but neither f(x) nor g(x) exists. lim
-
A scratch awl has a plastic handle and a steel blade and shank. Knowing that the density of plastic is 1030 kg/m3 and of steel is 7860 kg/m3, locate the center of gravity of the awl. 90 mm 10 mm 25...
-
An \(R L C\) circuit consists of a \(48 \Omega\) resistor, a \(200 \mu \mathrm{F}\) capacitor, and an inductor. The rms current is \(2.5 \mathrm{~A}\) when the circuit is connected to a \(120...
-
The trial balance of Pacilio Security Services Inc. as of January 1, 2021, had the following normal balances: Cash ..................... $113,718 Petty cash ................... 100 Accounts...
-
State the 2 ( two ) advantages and 3 ( three ) disadvantages of hiring an internal worker.
-
A statue 10ft. high is standing on a base 13ft. high. If an observer's eye is 5ft. above the ground, how far should he stand from the base in order that the angle between his lines of sight to the...
-
What impact does the Security and Exchange Commission's regulations have on corporate governance? How it can better the governance?
-
Businesses can assess their financials using a balance sheet. For property and casualty insurance companies, there are three major sections of the balance sheet: assets, liabilities, and...
-
Charlie had an account balance of $8,500 on April 1. He received a payment of $30,000 on April 15 from a sale of an investment. On April 29, he purchased a 32000 GIC for a 3 year term. The bank pays...
-
Velma, 37, is a target group member for the Work Opportunity Tax Credit (WOTC). In 2022, she was hired and worked 200 hours, earning $3,500. What is the amount of the WOTC credit her employer can...
-
Evaluate the different approaches accounting to forecasting income income for the investment?
-
Revise the following paragraph, omitting wordiness, correcting any grammar and punctuation problems and putting the main focus at the beginning: For over 20 years, teachers and parents have expressed...
-
Let (X. A. p) be a measure space. Show that for any A,B A, we have the equality: (AUB)+(An B) = (A) + (B).
-
Developing a new exportable natural resource can cause problems. One, discussed later in this chapter, is the problem of immiserizing growth: If you are already exporting and your export expansion...
-
Explain the effect of each of these on the shape and position of the countrys production-possibility curve: a. A proportionate increase in the total supplies (endowments) of all factors of...
-
A number of Latin American countries export coffee and import other goods. A longterm drought now reduces coffee production in the countries of this region. Assume that they remain exporters of...
Study smarter with the SolutionInn App