Comparative Balance Sheet Sally's Sunglasses Inc. Comparative Balance Sheet December 31, 2020 and 2019 2020 2019 Assets Current Assets: Cash Accounts Receivable, Net Inventory (sunglasses) Prepaid Insurance Prepaid Rent Total Current Assets $ $ $ $ $ $ 90,000 130,000 135,000 25,000 $ $ $ $ 70,000 90,000 80,000 20,000 12,000 272,000 380,000 $ Property, Plant, and Equipment: Equipment Less: Accumulated Depreciation - Equipment Total Property, Plant, and Equipment Total Assets $ $ $ $ 300,000 -75,000 225,000 605,000 250,000 -50,000 200,000 472,000 $ S 2020 2019 Liabilities and Stockholders' Equity Current Liabilities: Accounts Payable Notes Payable Salaries Payable Federal Income Taxes Payable Total Current Liabilities $ $ $ 75,000 20,000 40,000 10,000 145,000 $ $ $ 40,000 60,000 30,000 25,000 155,000 Long Term Liabilities Note Payable Total Liabilities $ $ 60,000 205,000 37,000 192,000 $ 130,000 Stockholders' Equity: Common Stock, $5 Par Paid-In Capital in Excess of Par Retained Earnings Total Stockholders' Equity Total Liabilities and Stockholders' Equity $ $ $ $ $ 175,000 25,000 200,000 400,000 605,000 $ $ $ $ 150,000 280,000 472,000 Comparative Income Statement Sally's Sunglasses Inc. Comparative Statement of Income For the Years Ended December 31, 2020 and 2019 2020 2019 $ 850,000 $ 475,000 $375,000 $ 790,000 $ 450,000 $ 340,000 $ $ $ Sales Cost of Goods Sold Gross Margin Operating Expenses: Salaries and Wages Expense Rent Expense Depreciation Expense Total Operating Expenses Income from Operations Loss on Sale of Equipment Interest Expense Increase (Decrease) in Operating Income Income before Taxes Federal Income Taxes Net Income $ 120,000 $ 30,000 $ 32,000 $ 182,000 $ 193,000 $ 2,000 $ 4,000 $ -6,000 200,000 40,000 10,000 250,000 90,000 un $ $ $ $ 5,000 -5,000 $ 187,000 S 56,100 $ 130,900 $ S $ 85,000 25,500 59,500 Comparative Statement of Retained Earnings Sally's Sunglasses Inc. Comparative Statement of Retained Earnings For the Years Ended December 31, 2020 and 2019 2020 2019 Retained Earnings, Beginning $ 150,000 $ 130,000 of Year Net Income $ 130,900 59,500 Less: Dividends $ 80,900 $ 39,500 Retained Earnings, End of Year $ 200,000 $ 150,000 1. Equipment with a cost of $50,000 on which accumulated depreciation has been recorded for $7,000 was sold for $41,000 cash. Additional equipment was purchased using a long-term note payable and cash. 2. Stock was issued for cash. 3. Dividends were paid in cash. Using a spreadsheet prepared in Excel and based on the information provided in the next section, complete the following requirements: 1. Determine the predetermined overhead rate. 2. Determine the total number of sunglasses to account for. 3. Prepare an equivalent unit's schedule. The schedule should follow the format below; you may add additional information if you would like. Equivalent Units Whole Units Direct Materials Plastic Frame XXX Direct Materials Conversion Polarized Lenses Costs XXX XXX Beginning XXX XXX XXX XXX XXX Start/Completed Completed/Transferred Out XXX XXX XXX XXX Ending xxx XXX XXX XXX 4. Determine the total costs for the plastic frames and the unit plastic-frame cost for each pair of sunglasses. (Round to the nearest cent) 5. Determine the total costs for the polarized lenses and the unit lens amount per pair of sunglasses. (Round to the nearest cent) 6. Determine the total conversion cost and the conversion cost per pair of sunglasses. (Round to the nearest cent.) 7. Calculate the total equivalent unit cost for each pair of sunglasses 8. Prepare a Cost of Production report. This report should show all costs transferred into Work-in-process and the costs transferred to Finished Goods. This process uses FIFO costing. Round all answers to the nearest cent. 9. Determine the amounts for the following. Show calculations for credit. a) Ending Work-in-Process Inventory in Units AND Dollars b) Ending Finished Goods Inventory in Units AND Dollars c) Cost of Goods Sold d) Over/Under Applied Manufacturing Overhead 4. Determine the total costs for the plastic frames and the unit plastic-frame cost for each pair of sunglasses. (Round to the nearest cent) 5. Determine the total costs for the polarized lenses and the unit lens amount per pair of sunglasses. (Round to the nearest cent) 6. Determine the total conversion cost and the conversion cost per pair of sunglasses (Round to the nearest cent.) 7. Calculate the total equivalent unit cost for each pair of sunglasses. 8. Prepare a cost of Production report. This report should show all costs transferred into Work-in-process and the costs transferred to Finished Goods. This process uses FIFO costing. Round all answers to the nearest cent. 9. Determine the amounts for the following. Show calculations for credit. a) Ending Work-in-Process Inventory in Units AND Dollars b) Ending Finished Goods Inventory in Units AND Dollars c) Cost of Goods Sold d) Over/Under Applied Manufacturing Overhead 8 Page CCOUNTING e) Gross Margin f) Income from Operations g) Net Income 10. Prepare the necessary Journal Entries related to the manufacturing cycle for this e) Gross Margin f) Income from Operations g) Net Income 10. Prepare the necessary Journal Entries related to the manufacturing cycle for this accounting period. Prepare journal entries for the accounting period. Use the account numbers in the chart of accounts, below, instead of the accounts names when writing the journal entries 10000 11000 12000 12100 14000 14100 15000 15050 16000 20000 40000 50000 Chart of Accounts Cash Accounts Receivable Plastic Material Inventory Lens Material Inventory Prepaid Rent Prepaid Insurance WIP FOH FG Wages Payable Sales COGS a. Record the purchase of the materials using cash b. Record the materials transferred to WIP c. Record the direct labor using cash d. Record the applied FOH e. Record the actual FOH using cash f. Record over or under applied FOH 8. Record the transfer of goods from WIP to FG h. Record the sale of goods on account i. Record the cost of the inventory that was sold Add information concerning numbers here and enter into Blackboard as specified below a. When the answer is in units enter the number as is (See example below) i. 280 b. When the answer is for ratios (ie.%) and it has a decimal take the decimal out to two spaces (See example below) ii. 280.89 C. When ratios are in days/times take out to two decimal places (See example below) iii. 280.96 days d. When the answer is in dollars ALWAYS include a dollar sign and cents even if the cents is zero add .00 (See example below) iv. $280.00 or $3,800.00 e. When there is a single journal entry enter information EXACTLY as is below in the sequence of Dr/Cr, Account Number, and amount (note the signs, decimals, spaces, and capital letter) v. Dr 10000 $280.00 Cr 20000 $280.00 f. When there is a journal entry requiring two debits or credits enter information EXACTLY as is below in the sequence of Dr/Cr, Account Number, amount, and always put the smaller account number FIRST (note the signs, decimals, spaces, capital letters and order of the accounts) vi. Dr 10000 $280.00 Dr 60000 $40.00 Cr 20000 $300.00 vil. Dr 10000 $300.00 Cr 20000 $280.00 Cr 90000 $40.00 viii. Dr 10000 $280.00 Dr 60000 $40.00 Cr 70000 $290.00 Cr 90000 $10.00 8. When there is a sale enter the sale first and then add the COGS and the transfer of Inventory i. Dr 10000 $10,368.00 Cr 40000 $10,000.00 Cr 26833 $368.00 Dr 50000 $70,000.00 Cr 12000 $50,000.00 Cr 12100 $20,000.00 h. Follow examples exactly as are! Do NOT copy and paste from Excel into Blackboard. If your entry is formatted incorrectly it will be counted wrong. Using a spreadsheet prepared in Excel and based on the information provided in the next section, complete the following requirements: 1. Determine the predetermined overhead rate. 2. Determine the total number of sunglasses to account for. 3. Prepare an equivalent unit's schedule. The schedule should follow the format below; you may add additional information if you would like. Equivalent Units Whole Units Direct Materials Plastic Frame XXX Direct Materials Conversion Polarized Lenses Costs XXX XXX XXX Beginning Start/Completed Completed/Transferred Out XXX XXX XXX XXX XXX XXX XXX XXX Ending XXX XXX XXX XXX 4. Determine the total costs for the plastic frames and the unit plastic-frame cost for each pair of sunglasses. (Round to the nearest cent) 5. Determine the total costs for the polarized lenses and the unit lens amount per pair of sunglasses. (Round to the nearest cent) 6. Determine the total conversion cost and the conversion cost per pair of sunglasses. (Round to the nearest cent.) 7. Calculate the total equivalent unit cost for each pair of sunglasses 8. Prepare a Cost of Production report. This report should show all costs transferred into Work-in-Process and the costs transferred to Finished Goods. This process uses FIFO costing. Round all answers to the nearest cent. 9. Determine the amounts for the following. Show calculations for credit. a) Ending Work-in-Process Inventory in Units AND Dollars b) Ending Finished Goods Inventory in Units AND Dollars c) Cost of Goods Sold d) Over/Under Applied Manufacturing Overhead