Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

4) Worldwide Corp.'s statement of financial position accounts as of December 31, 2019 and 2018 and information relating to 2019 activities are presented below. December

4) Worldwide Corp.'s statement of financial position accounts as of December 31, 2019 and 2018 and information relating to 2019 activities are presented below.

December 31,

20192018

Assets

Cash$440,000$160,000

Short-term investments800,000-

Accounts receivable (net)1,050,0001,140,000

Inventory1,160,0001,020,000

Long-term investments400,000600,000

Plant assets3,100,0002,000,000

Accumulated depreciation(700,000)(900,000)

Patent280,000300,000

Total assets$6,530,000$4,320,000

Liabilities and Equity

Accounts payable$1,490,000$1,210,000

Other accrued liabilities200,000250,000

Notes payable (nontrade)560,000-

Common Stock-$10 par1,600,0001,400,000

Additional paid-in capital800,000500,000

Retained earnings1,880,000960,000

Total equity and liabilities$6,530,000$4,320,000

Information relating to 2019 activities:

Net income for 2019 was $1,220,000. This amount includes net sales revenue of $4,500,000 and cost of goods sold of $2,200,000.

Equipment costing $1,000,000 and having a carrying amount of $320,000 was sold in 2019 for $360,000.

A long-term investment was sold in 2019 for $345,000. There were no other transactions affecting long-term investments in 2019.

20,000 ordinary shares were issued in 2019 for $25 a share.

Short-term investments consist of treasury bills maturing on 9/30/20.

Compute cash paid for merchandise.

A) $2,060,000

B) $2,200,000

C) $2,340,000

D) $2,620,000

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

College Accounting Chapters 1-9

Authors: James Heintz

22nd Edition

1305888537, 978-1305666184

More Books

Students also viewed these Accounting questions

Question

Define failure. (p. 273)

Answered: 1 week ago