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Golden Corp.'s current year income statement, comparative balance sheets, and additional information follow. For the year, (1) all sales are credit sales, (2) all credits

Golden Corp.'s current year income statement, comparative balance sheets, and additional information follow. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, (5) Other Expenses are all cash expenses, and (6) any change in Income Taxes Payable reflects the accrual and cash payment of taxes.

GOLDEN CORPORATION Comparative Balance Sheets December 31
Current Year Prior Year
Assets
Cash $ 164,000 $ 107,000
Accounts receivable 83,000 71,000
Inventory 601,000 526,000
Total current assets 848,000 704,000
Equipment 335,000 299,000
Accum. depreciationEquipment (158,000 ) (104,000 )
Total assets $ 1,025,000 $ 899,000
Liabilities and Equity
Accounts payable $ 87,000 $ 71,000
Income taxes payable 28,000 25,000
Total current liabilities 115,000 96,000
Equity
Common stock, $2 par value 592,000 568,000
Paid-in capital in excess of par value, common stock 196,000 160,000
Retained earnings 122,000 75,000
Total liabilities and equity $ 1,025,000 $ 899,000

GOLDEN CORPORATION Income Statement For Current Year Ended December 31
Sales $ 1,792,000
Cost of goods sold 1,086,000
Gross profit 706,000
Operating expenses
Depreciation expense $ 54,000
Other expenses 494,000 548,000
Income before taxes 158,000
Income taxes expense 22,000
Net income $ 136,000

Additional Information on Current Year Transactions

  1. Purchased equipment for $36,000 cash.
  2. Issued 12,000 shares of common stock for $5 cash per share.
  3. Declared and paid $89,000 in cash dividends.

Using the income statement, the comparative balance sheet, and the additional information given above, reconstruct the entries for the summarized activity of the current fiscal year. Upon completion, the trial balance tab should agree with the December 31, current year balances.

1. Reconstruct the journal entry for cash receipts from customers, incorporating the change in the related balance sheet account(s), if any.

2. Reconstruct the journal entry for cash payments for inventory, incorporating the change in the related balance sheet account(s), if any.

3. Reconstruct the journal entry for depreciation expense, incorporating the change in the related balance sheet account(s), if any.

4. Reconstruct the journal entry for cash paid for other operating expenses, incorporating the change in the related balance sheet account(s), if any.

5. Reconstruct the journal entry for income taxes expense, incorporating the change in the related balance sheet account(s), if any.

6. Reconstruct the entry for the purchase of new equipment.

7. Reconstruct the entry for the issuance of common stock.

8. Reconstruct the entry to record the payment of cash dividends.

9. Close the revenue account(s) to income summary.

10. Close the expense accounts to income summary.

11. Close Income Summary to Retained Earnings.

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