During 2012, Consolidated Corporation made sales of $4,300 (assume all on account) and collected cash of $4,500

Question:

During 2012, Consolidated Corporation made sales of $4,300 (assume all on account) and collected cash of $4,500 from customers. Operating expenses totaled $1,200, all paid in cash. At year end, 2012, Consolidated customers owed the company $900. Consolidated owed creditors $1,000 on account. All amounts are in millions.

1. For these facts, show what Consolidated reported on the following financial statements:

Income statement

Balance sheet

2. Suppose Consolidated had used the cash basis of accounting. What would Consolidated have reported for these facts?

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...