ACC 122 Spring 2019 Chapters 13-15 Project GetSmart Business Corporation's Trial balance as of December 31, 2019 is presented below. All 2019 transactions havebeen recorded exceptfor the items described below Debit Credit $ 20,712 28,789 25,540 55,674 275,850 55,120 Cash Accounts Receivable Inventory Buildings Equipment Allowance for Doubtful Accounts Accumulated Depreciation-Buildings Accumulated Depreciation-Equipment Accounts Payable Interest Payable Dividends Payable Unearned Rent Revenue IncomeTax Payable Bonds Payable Discount on Bonds Payable Common Stock ($2 par) Paid in Capital in Excess of Par-Common Stock Preferred Stock (560 par) Paid in Capital in Excess of Par-Prefered Stock Retained Earnings Treasury Stock Cash Dividends Sales Revenue Rent Revenue Bad Debt Expense Interest Expense Cost of Goods Sold Depreciation Expense Other Operating Expenses Saaries and Wages Expense Income Tax Expense 1,027 63,306 16,048 35,278 48,900 29,200 44,580 93,726 702,551 440,025 53,274 79,632 S 1,034,616 1,034,616 Total CONTINUED ransaction Round all calculations if necessary to -0- decimals (to the nearest dollar, do not show cents). 1. On January 1, 2019, GetSmart issued 520 shares of S60 par, 5% preferred stock for $75,810. 2.On January 1, 2019, GetSmart also issued 5,800 shares of common stock for $42,050. 3. On January 1, 2019, GeSm art issued $325,000, 5.5%, 9 year bonds when the m a ketre was 6%. Interest isto bepaid annually on each January 1, beginning 1 year from date of issue. 4. GetSmartreaqured3,600 shares of its common stock on January 12, 2019 for $8.50 per share. 5.On December 31, 2019, GetSmart declared the annual preferred dividend plus a$2.75 pe share dividendon the outstanding common stock, all payable in cash onJanuary 31, 2020. 6. On December 31, 2019, GetSmart estimates that the total amount of accounts receivable th s uncollectible at year end is $1,850. 7. The building is being depreciated using the straight linemethod over 25 years. The salvage value is $100,000. 8. The equipment is being depreciated using the straight lnemethod over 5 years. The salvage value is $15,000. 9. The unearned rent wascolected on December 1, 2019. It was receipt of 3 months' rent in advance (December 1, 2019 through Febr uary 28, 2020) 10. The first cash interest payment on the 5.5% bonds is due January 1, 2020. The annual interest on the bonds for 2019 hasnot yet been recorded. GetSmart uses the effective interest method. 11. TheGetSmart Business Corporation must make an adjusting entry to accrue income tax expense on Income Before Income Tax at a rate of 26%. The income taxeswill not bepaid until March 2020. Instructions: (a) PrepareJournal enties for thetransactions listed above. Show all calculations. (b) Prepare an updated December 31, 2019 trial balance. (c) Preparea mutiple-step incomestatement for the year ending December 31, 2019 (d) Prepare aretained earnings statement for theyear ending December 31, 2019 (e) Prepare a classified balance sheet as of December 31, 2019 (f) Calculate thefollowing ratios, clearly presenting your work and answers 1. Working capital 2. Currentratio 3. Return on Stockholders' Equity (use ending Common Stockholders' Equity) 4. EPS (all shares are evenly weighted) 5. Debt to assets ratio 6. Times interest earned ratio Ch. 13-15 Project GetSmart Business Corpora tion General Joumal Date Account Titles Debit Credit 1 2. A. CONTINUED CR DR 1H Ch. 13-15 Project GetSmart Business Corporation Updated Trial Balance December 31, 2019 DR CR ash ccounts Re ceivable nvento and Buildings quipment llowance for Dou btful Accounts ccumu lated Depreciation Buildings ccumu lated Depreciation Equipment ccounts Payable Intere st Payable ividends Payable Uneamed Rent Revenue In come Tax Payable Bonds Payable iscount on Bonds Payable Common Stock (52 par) Paid-in Capita in Excess of Par - Common Stodk Preferred Stock (560 par) Paid-in Capita in Excess of Par Preferred Stock Retained Earnings reasury Stock Cash Dividends ales Revenue ent Revenue Bad Debts Expense Intere st Expense Cost ofGoods Sold Depreciation Expense Other Operating Expenses Salaries and Wages Expen se ncome lTax Expense Totals Ch. 13-15 Project GetSmart Business Corporation Income Statement For the Year Ended December 31, 2019 GetSmart Busines Corporation Retained Earnings Statement For the Year Ended December 31, 2019 Ch. 13-15 Project mart Business Corporation Balance Sheet December 31, 2019 Assets (f) Ratios: Using theratios as found in our textbook, cakulate the fo lowing for the GetSmart Business Corporation using the numbersyou've arrived at in the project. Round answers as needed to 2 decimal places. Besureto clearly present all of your work, ncluding all ratio formulas. You may use thereverse side if necessary. 1. Working Capital_ 2. Current Ratio 3. Return on Stockholders Equity: (Use ending Common Stockholders Equity, not aver age. Common Stockholders' Equity does not include the par value of preferred stock.) 4. EPS: (all shares are evenly weghted) 5. Debt to Assets ratio: 6. Times Interest Earned Ratio: ACC 122 Spring 2019 Chapters 13-15 Project GetSmart Business Corporation's Trial balance as of December 31, 2019 is presented below. All 2019 transactions havebeen recorded exceptfor the items described below Debit Credit $ 20,712 28,789 25,540 55,674 275,850 55,120 Cash Accounts Receivable Inventory Buildings Equipment Allowance for Doubtful Accounts Accumulated Depreciation-Buildings Accumulated Depreciation-Equipment Accounts Payable Interest Payable Dividends Payable Unearned Rent Revenue IncomeTax Payable Bonds Payable Discount on Bonds Payable Common Stock ($2 par) Paid in Capital in Excess of Par-Common Stock Preferred Stock (560 par) Paid in Capital in Excess of Par-Prefered Stock Retained Earnings Treasury Stock Cash Dividends Sales Revenue Rent Revenue Bad Debt Expense Interest Expense Cost of Goods Sold Depreciation Expense Other Operating Expenses Saaries and Wages Expense Income Tax Expense 1,027 63,306 16,048 35,278 48,900 29,200 44,580 93,726 702,551 440,025 53,274 79,632 S 1,034,616 1,034,616 Total CONTINUED ransaction Round all calculations if necessary to -0- decimals (to the nearest dollar, do not show cents). 1. On January 1, 2019, GetSmart issued 520 shares of S60 par, 5% preferred stock for $75,810. 2.On January 1, 2019, GetSmart also issued 5,800 shares of common stock for $42,050. 3. On January 1, 2019, GeSm art issued $325,000, 5.5%, 9 year bonds when the m a ketre was 6%. Interest isto bepaid annually on each January 1, beginning 1 year from date of issue. 4. GetSmartreaqured3,600 shares of its common stock on January 12, 2019 for $8.50 per share. 5.On December 31, 2019, GetSmart declared the annual preferred dividend plus a$2.75 pe share dividendon the outstanding common stock, all payable in cash onJanuary 31, 2020. 6. On December 31, 2019, GetSmart estimates that the total amount of accounts receivable th s uncollectible at year end is $1,850. 7. The building is being depreciated using the straight linemethod over 25 years. The salvage value is $100,000. 8. The equipment is being depreciated using the straight lnemethod over 5 years. The salvage value is $15,000. 9. The unearned rent wascolected on December 1, 2019. It was receipt of 3 months' rent in advance (December 1, 2019 through Febr uary 28, 2020) 10. The first cash interest payment on the 5.5% bonds is due January 1, 2020. The annual interest on the bonds for 2019 hasnot yet been recorded. GetSmart uses the effective interest method. 11. TheGetSmart Business Corporation must make an adjusting entry to accrue income tax expense on Income Before Income Tax at a rate of 26%. The income taxeswill not bepaid until March 2020. Instructions: (a) PrepareJournal enties for thetransactions listed above. Show all calculations. (b) Prepare an updated December 31, 2019 trial balance. (c) Preparea mutiple-step incomestatement for the year ending December 31, 2019 (d) Prepare aretained earnings statement for theyear ending December 31, 2019 (e) Prepare a classified balance sheet as of December 31, 2019 (f) Calculate thefollowing ratios, clearly presenting your work and answers 1. Working capital 2. Currentratio 3. Return on Stockholders' Equity (use ending Common Stockholders' Equity) 4. EPS (all shares are evenly weighted) 5. Debt to assets ratio 6. Times interest earned ratio Ch. 13-15 Project GetSmart Business Corpora tion General Joumal Date Account Titles Debit Credit 1 2. A. CONTINUED CR DR 1H Ch. 13-15 Project GetSmart Business Corporation Updated Trial Balance December 31, 2019 DR CR ash ccounts Re ceivable nvento and Buildings quipment llowance for Dou btful Accounts ccumu lated Depreciation Buildings ccumu lated Depreciation Equipment ccounts Payable Intere st Payable ividends Payable Uneamed Rent Revenue In come Tax Payable Bonds Payable iscount on Bonds Payable Common Stock (52 par) Paid-in Capita in Excess of Par - Common Stodk Preferred Stock (560 par) Paid-in Capita in Excess of Par Preferred Stock Retained Earnings reasury Stock Cash Dividends ales Revenue ent Revenue Bad Debts Expense Intere st Expense Cost ofGoods Sold Depreciation Expense Other Operating Expenses Salaries and Wages Expen se ncome lTax Expense Totals Ch. 13-15 Project GetSmart Business Corporation Income Statement For the Year Ended December 31, 2019 GetSmart Busines Corporation Retained Earnings Statement For the Year Ended December 31, 2019 Ch. 13-15 Project mart Business Corporation Balance Sheet December 31, 2019 Assets (f) Ratios: Using theratios as found in our textbook, cakulate the fo lowing for the GetSmart Business Corporation using the numbersyou've arrived at in the project. Round answers as needed to 2 decimal places. Besureto clearly present all of your work, ncluding all ratio formulas. You may use thereverse side if necessary. 1. Working Capital_ 2. Current Ratio 3. Return on Stockholders Equity: (Use ending Common Stockholders Equity, not aver age. Common Stockholders' Equity does not include the par value of preferred stock.) 4. EPS: (all shares are evenly weghted) 5. Debt to Assets ratio: 6. Times Interest Earned Ratio