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Can I please get the step by step solution to this problem please? many thanks in advance! Allarco Inc.'s property, plant and equipment subledger at
Can I please get the step by step solution to this problem please? many thanks in advance!
Allarco Inc.'s property, plant and equipment subledger at January 1, 2019 appeared as follows:
Additional information:
Using the information from the PPE asset subledger and the following December 31, 2019 adjusted account balances, complete the income statement (showing all depreciation and amortization expenses together under expenses) and a statement of stockholders' equity for the year ended December 31, 2019 along with the December 31, 2019 classified balance sheet. Assume that the corporation issued $66,600 worth of stock during 2019.
Additional information:
- Allarco Inc. calculates depreciation and amortization to the nearest month.
- S/L = Straight Line; DDB = Double-Declining Balance; Units = Units of Production
- There have been no disposals, revisions, or impairments prior to January 1, 2019
- Actual miles driven by the trucks: 2017 - 168,000; 2018 - 319,000; 2019 - 259,000
- At the beginning of 2019, it was determined that the building would be used for 1 year less than originally estimated.
- Used boats and machinery were purchased on July 1, 2019, for a total of $56,000 at a bankruptcy sale. The appraised value of the boats was $47,000 and of the machinery $40,000. The old machinery was given to a charitable organization on July 4, 2019.
- The estimated useful lives and residual values of the July 1 purchases were 4 years and $5,000 for the boats, and 4 years and $4,000 for the machinery. These assets will be depreciated using the DDB method.
Using the information from the PPE asset subledger and the following December 31, 2019 adjusted account balances, complete the income statement (showing all depreciation and amortization expenses together under expenses) and a statement of stockholders' equity for the year ended December 31, 2019 along with the December 31, 2019 classified balance sheet. Assume that the corporation issued $66,600 worth of stock during 2019.
I dont know how to calculate this part of the exercise
Allarco Inc. Income Statement For Year Ended December 31, 2019 Revenues Consulting Revenue Earned Rent Earned Commissions Earned Interest Earned Total revenues Expenses Loss on Sale/Disposal Interest Expense Depreciation/Amortization Total expenses Income before tax Income taxes expense Net income \begin{tabular}{lr} \multicolumn{1}{c}{ Account } & Balance \\ \hline Accounts payable & 16,000 \\ Bonds payable & 87,800 \\ Cash & 12,200 \\ Commissions earned & 112,400 \\ Common stock & 141,800 \\ Consulting revenue earned & 107,700 \\ Dividends & 52,800 \\ Income taxes expense & 39,800 \\ Interest earned & 110,300 \\ Interest expense & 30,400 \\ Interest payable & 42,900 \\ Land & 27,400 \\ Long-term notes payable & 38,100 \\ Loss on sale/disposal & 136,700 \\ Rent earned & 114,500 \\ Rent receivable & 64,200 \\ Retained earnings & 144,100 \\ Short-term notes payable & 36,800 \\ Unearned rent & 43,400 \\ \hline \end{tabular} \begin{tabular}{c|l|} & \multicolumn{2}{|c}{ Depreciation/Amortization } \\ \hline Life & Accum. Balance Expense for Accum. Balance \\ Dec. 31, 2018 2019 & Dec. 31, 2019 \\ \hline 5 years & \\ 10 years & \\ 57,000 miles & \\ 6 years & \\ 7 years & \\ 10 years & \\ 4 years & \\ 4 years & \\ \hline \end{tabular} Allarco Inc. Income Statement For Year Ended December 31, 2019 Revenues Consulting Revenue Earned Rent Earned Commissions Earned Interest Earned Total revenues Expenses Loss on Sale/Disposal Interest Expense Depreciation/Amortization Total expenses Income before tax Income taxes expense Net income \begin{tabular}{lr} \multicolumn{1}{c}{ Account } & Balance \\ \hline Accounts payable & 16,000 \\ Bonds payable & 87,800 \\ Cash & 12,200 \\ Commissions earned & 112,400 \\ Common stock & 141,800 \\ Consulting revenue earned & 107,700 \\ Dividends & 52,800 \\ Income taxes expense & 39,800 \\ Interest earned & 110,300 \\ Interest expense & 30,400 \\ Interest payable & 42,900 \\ Land & 27,400 \\ Long-term notes payable & 38,100 \\ Loss on sale/disposal & 136,700 \\ Rent earned & 114,500 \\ Rent receivable & 64,200 \\ Retained earnings & 144,100 \\ Short-term notes payable & 36,800 \\ Unearned rent & 43,400 \\ \hline \end{tabular} \begin{tabular}{c|l|} & \multicolumn{2}{|c}{ Depreciation/Amortization } \\ \hline Life & Accum. Balance Expense for Accum. Balance \\ Dec. 31, 2018 2019 & Dec. 31, 2019 \\ \hline 5 years & \\ 10 years & \\ 57,000 miles & \\ 6 years & \\ 7 years & \\ 10 years & \\ 4 years & \\ 4 years & \\ \hline \end{tabular} Step by Step Solution
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