Lewitas Ltd. earned revenues of $35 million during 2014 and ended the year with income of $8 million. During 2014, Lewitas Ltd. collected $33 million from customers and paid cash for all of its expenses plus an additional $1 million for accounts payable. Answer these questions about Lewitas's operating results, financial position, and cash flows during 2014:
Requirements
1. How much were the company's total expenses? Show your work.
2. Identify all the items that Lewitas will report on its 2014 income statement. Show each amount.
3. Lewitas began 2014 with receivables of $4 million. All sales were on account. What was the company's receivables balance at the end of 2014? Identify the appropriate financial statement, and show how Lewitas will report ending receivables in the 2014 annual report.
4. Lewitas began 2014 owing accounts payable totaling $9 million. How much in accounts payable did the company owe at the end of the year? Identify the appropriate financial statement, and show how Lewitas will report these accounts payable in its 2014 annual report.