Assignment: Chapter 2 homework

1.

Missing Income Statement Amounts

For each of the following cases, fill in the blank with the appropriate dollar amount.

Sara's Coffee Shop Amy's Deli Jane's Bagels

Net sales $32,400 $ _________________ $71,300

Cost of goods sold _________________ 23,000 _________________

Gross profit 6,500 35,300 _________________

Selling expenses 2,800 _________________ 8,200

General and administrative expenses 1,400 5,600 _________________

Total operating expenses _________________ 17,200 14,600

Net income $2,300 $18,100 $21,000

2.

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Statement of Retained Earnings

Landon Corporation was organized on January 2, 2012, with the investment of $100,000 by each of its two stockholders. Net income for its first year of business was $87,220. Net income increased during 2013 to $127,340 and to $148,990 during 2014. Landon paid $21,000 in dividends to each of the two stockholders in each of the three years.

Required:

Prepare a statement of retained earnings for the year ended December 31, 2014.

Landon Corporation

Statement of Retained Earnings

For the Year Ended December 31, 2014

$

$

3.

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Financial Statement Classification

Potential stockholders and lenders are interested in a company's financial statements. Identify the statement balance sheet, income statement, or retained earnings statementon which each of the following items would appear. Note that some items may be related to more than one financial statement.

Accounts Financial Statement

1. Accounts payable _________________

2. Accounts receivable _________________

3. Advertising expense _________________

4. Bad debt expense _________________

5. Bonds payable _________________

6. Buildings _________________

7. Cash _________________

8. Common stock _________________

9. Depreciation expense _________________

10. Dividends _________________

11. Land held for future expansion _________________

12. Loan payable _________________

13. Office supplies _________________

14. Patent _________________

15. Patent amortization expense _________________

16. Prepaid insurance _________________

17. Retained earnings _________________

18. Sales _________________

19. Utilities expense _________________

20. Wages payable _________________