Instructions Note: You must complete Comprehensive Problem 4 (Part A) before completing Comprehensive Problem 4 (Part B) Required 2. After all of the transactions for the year ended December 31, Year 1, had been posted fincluding the transactions recorded in part (1) and all adjusting entries], the data that follows were taken from the records of Equinox Products Inc. A. Prepare a multiple-step income statement for the year ended December 31, Year 1, concluding with earnings per share. In computing earnings per share, assume that the average number of common shares outstanding was 100,000 and preferred dividends were $100,000 Enter all amounts as positive numbers EXCEPT in the Other income and expenses. In that section only, enter amounts that represent other expenses as negative numbers using a minus sign. (Round earnings per share to the nearest cent.) B. Prepare a retained earnings statement for the year ended December 31, Year 1. C. Prepare a balance sheet in report form as of December 31, Year 1. Read the instructions above each financial statement carefully. They may contain specific instructions for completing the statement. Income Statement data Advertising expense Cost of merchandise sold Delivery expense Depreciation expense-office buildings and equipment Depreciation expense-store buildings and equipment Dividend revenue $150,000 3,700,000 30,000 30,000 100,000 4,500 Dividend revenue Gain on sale of investment Income of Pinkberry Co. investment Income tax expense Interest expense Interest revenue Miscellaneous administrative expense Miscellaneous selling expense Office rent expense Office salaries expense Office supplies expense Sales Sales commissions Sales salaries expense Store supplies expense 4,500 4,980 76,800 140,500 21,000 2,720 7,500 14,000 50,000 170,000 10,000 5,254,000 185,000 385,000 21,000 Retained earnings and balance sheet data Accounts payable Accounts receivable Accumulated depreciation-office buildings and equipment Accumulated depreciation-store buildings and equipment $194,300 545,000 1,580,000 4,126,000 4,126,000 8,450 260,130 500,000 246,000 Accumulated depreciation-store buildings and equipment Allowance for doubtful accounts Available-for-sale investments (at cost) Bonds payable, 5%, due 20Y2 Cash Common stock, $20 par (400,000 shares authorized, 100,000 shares issued, 94,600 outstanding) Dividends Cash dividends for common stock Cash dividends for preferred stock Goodwill Income tax payable Interest receivable Investment in Pinkberry Co. stock (equity method) Investments-Dream Inc. bonds (long term) Merchandise inventory (December 31, Year 1) at lower of cost (FIFO) or market Office buildings and equipment Paid-in capital from sale of treasury stock Excess of issue price over par: -Common stock 2,000,000 155,120 100,000 500,000 44,000 1,125 1,009,300 90,000 778,000 4,320,000 13,000 886,800 886,800 -Common stock -Preferred stock Preferred 5% stock, $80 par (30,000 shares authorized, 20,000 shares issued) Premium on bonds payable Prepaid expenses Retained earnings, January 1, Year 1 Store buildings and equipment Treasury stock (5,400 shares of common stock at cost of $33 per share) Unrealized gain (loss) on available-for-sale investments Valuation allowance for available-for-sale investments 150,000 1,600,000 19,000 27,400 9,319,725 12,560,000 178,200 (6,500) (6,500) Chart of Accounts CHART OF ACCOUNTS Equinox Products Inc General Ledger ASSETS REVENUE ASSETS REVENUE 410 Sales 611 Dividend Revenue 621 Interest Revenue 631 Income of Pinkberry Co. Investment 641 Gain on Sale of Investments 110 Cash 121 Accounts Receivable 122 Allowance for Doubtful Accounts 131 Merchandise Inventory 132 Interest Receivable 133 Prepaid Expenses 141 Investments-Solstice Corp. Stock 142 Investment in Pinkberry Co. Stock 143 Investments-Dream Inc. Bonds 144 Valuation Allowance for Available-for-Sale Investments 181 Store Buildings and Equipment 182 Accumulated Depreciation-Store Buildings and Equipment 183 Office Buildings and Equipment 184 Accumulated Depreciation-Office Buildings and Equipment 191 Goodwill EXPENSES 511 Cost of Merchandise Sold 512 Bad Debt Expense 520 Sales Salaries Expense 521 Sales Commissions 522 Office Salaries Expense 531 Advertising Expense 532 Delivery Expense 537 Store Supplies Expense 538 Office Supplies Expense 539 Office Rent Expense 541 Income lax Expense 551 Depreciation Expense-Store Buildings and Equipment 552 Depreciation Expense-Office Buildings and Equipment LIABILITIES 211 Accounts Payable 221 Income Tax Payable 225 Cash Dividends Payable 225 Cash Dividends Payable 251 Bonds Payable 252 Discount on Bonds Payable 253 Premium on Bonds Payable 552 Depreciation Expense-Office Buildings and Equipment 591 Miscellaneous Selling Expense 592 Miscellaneous Administrative Expense 710 Interest Expense 731 Loss on Sale of Investments EQUITY 311 Preferred Stock 312 Paid-in Capital in Excess of Par-Preferred Stock 321 Common Stock 322 Paid-in Capital in Excess of Par-Common Stock 331 Retained Earnings 341 Cash Dividends 351 Treasury Stock 352 Paid-in Capital from Sale of Treasury Stock 361 Unrealized Gain (Loss) on Available-for-Sale Investments Labels and Amount Descriptions Labels Current assets abels Current assets Current liabilities December 31, Year 1 Dividends For the Year Ended December 31, Year 1 Intangible assets Investments Long-term liabilities Operating expenses Other revenue and expenses Paid-in capital Property, plant, and equipment Amount Descriptions Available-for-sale investments Decrease in retained earnings Gross profit Income before income tax Income from operations Increase in retained earnings Net income Net income Net loss Retained earnings, January 1, Year 1 Retained earnings, December 31, Year 1 Total administrative expenses Total Total assets Total current assets Total current liabilities Total liabilities Total liabilities and stockholders' equity Total long-term liabilities Total investments Total operating expenses Total paid-in capital Total property, plant, and equipment Total selling expenses Total stockholders' equity Income Statement Income Statement 1. A. Prepare a multiple-step income statement for the year ended December 31, Year 1, concluding with earnings per share. In computing earnings per share, assume that the average number of common shares outstanding was 100,000 and preferred dividends were $100,000. Enter all amounts as positive numbers EXCEPT in the Other income and expenses. In that section only, enter amounts that represent other expenses as negative numbers using a minus sign. Round earnings per share to the nearest cent. . Refer to the Chart of Accounts for exact wording of account titles Refer to the Labels and Amount Descriptions for exact wording of text entries. Equinox Products Inc. Income Statement (Label) 4 (Label) 5 Selling expenses: Retained Earnings Statement 2. B. Prepare a retained earnings statement for the year ended December 31, Year 1. Refer to the Chart of Accounts for exact wording of account titles. Refer to the Labels and Amount Descriptions for exact wording of text entries. You ill need to enter the word Less" or "Add" as necessary. Equinox Products, Indc. Retained Earnings Statement (Label) 3 Label) Instructions Note: You must complete Comprehensive Problem 4 (Part A) before completing Comprehensive Problem 4 (Part B) Required 2. After all of the transactions for the year ended December 31, Year 1, had been posted fincluding the transactions recorded in part (1) and all adjusting entries], the data that follows were taken from the records of Equinox Products Inc. A. Prepare a multiple-step income statement for the year ended December 31, Year 1, concluding with earnings per share. In computing earnings per share, assume that the average number of common shares outstanding was 100,000 and preferred dividends were $100,000 Enter all amounts as positive numbers EXCEPT in the Other income and expenses. In that section only, enter amounts that represent other expenses as negative numbers using a minus sign. (Round earnings per share to the nearest cent.) B. Prepare a retained earnings statement for the year ended December 31, Year 1. C. Prepare a balance sheet in report form as of December 31, Year 1. Read the instructions above each financial statement carefully. They may contain specific instructions for completing the statement. Income Statement data Advertising expense Cost of merchandise sold Delivery expense Depreciation expense-office buildings and equipment Depreciation expense-store buildings and equipment Dividend revenue $150,000 3,700,000 30,000 30,000 100,000 4,500 Dividend revenue Gain on sale of investment Income of Pinkberry Co. investment Income tax expense Interest expense Interest revenue Miscellaneous administrative expense Miscellaneous selling expense Office rent expense Office salaries expense Office supplies expense Sales Sales commissions Sales salaries expense Store supplies expense 4,500 4,980 76,800 140,500 21,000 2,720 7,500 14,000 50,000 170,000 10,000 5,254,000 185,000 385,000 21,000 Retained earnings and balance sheet data Accounts payable Accounts receivable Accumulated depreciation-office buildings and equipment Accumulated depreciation-store buildings and equipment $194,300 545,000 1,580,000 4,126,000 4,126,000 8,450 260,130 500,000 246,000 Accumulated depreciation-store buildings and equipment Allowance for doubtful accounts Available-for-sale investments (at cost) Bonds payable, 5%, due 20Y2 Cash Common stock, $20 par (400,000 shares authorized, 100,000 shares issued, 94,600 outstanding) Dividends Cash dividends for common stock Cash dividends for preferred stock Goodwill Income tax payable Interest receivable Investment in Pinkberry Co. stock (equity method) Investments-Dream Inc. bonds (long term) Merchandise inventory (December 31, Year 1) at lower of cost (FIFO) or market Office buildings and equipment Paid-in capital from sale of treasury stock Excess of issue price over par: -Common stock 2,000,000 155,120 100,000 500,000 44,000 1,125 1,009,300 90,000 778,000 4,320,000 13,000 886,800 886,800 -Common stock -Preferred stock Preferred 5% stock, $80 par (30,000 shares authorized, 20,000 shares issued) Premium on bonds payable Prepaid expenses Retained earnings, January 1, Year 1 Store buildings and equipment Treasury stock (5,400 shares of common stock at cost of $33 per share) Unrealized gain (loss) on available-for-sale investments Valuation allowance for available-for-sale investments 150,000 1,600,000 19,000 27,400 9,319,725 12,560,000 178,200 (6,500) (6,500) Chart of Accounts CHART OF ACCOUNTS Equinox Products Inc General Ledger ASSETS REVENUE ASSETS REVENUE 410 Sales 611 Dividend Revenue 621 Interest Revenue 631 Income of Pinkberry Co. Investment 641 Gain on Sale of Investments 110 Cash 121 Accounts Receivable 122 Allowance for Doubtful Accounts 131 Merchandise Inventory 132 Interest Receivable 133 Prepaid Expenses 141 Investments-Solstice Corp. Stock 142 Investment in Pinkberry Co. Stock 143 Investments-Dream Inc. Bonds 144 Valuation Allowance for Available-for-Sale Investments 181 Store Buildings and Equipment 182 Accumulated Depreciation-Store Buildings and Equipment 183 Office Buildings and Equipment 184 Accumulated Depreciation-Office Buildings and Equipment 191 Goodwill EXPENSES 511 Cost of Merchandise Sold 512 Bad Debt Expense 520 Sales Salaries Expense 521 Sales Commissions 522 Office Salaries Expense 531 Advertising Expense 532 Delivery Expense 537 Store Supplies Expense 538 Office Supplies Expense 539 Office Rent Expense 541 Income lax Expense 551 Depreciation Expense-Store Buildings and Equipment 552 Depreciation Expense-Office Buildings and Equipment LIABILITIES 211 Accounts Payable 221 Income Tax Payable 225 Cash Dividends Payable 225 Cash Dividends Payable 251 Bonds Payable 252 Discount on Bonds Payable 253 Premium on Bonds Payable 552 Depreciation Expense-Office Buildings and Equipment 591 Miscellaneous Selling Expense 592 Miscellaneous Administrative Expense 710 Interest Expense 731 Loss on Sale of Investments EQUITY 311 Preferred Stock 312 Paid-in Capital in Excess of Par-Preferred Stock 321 Common Stock 322 Paid-in Capital in Excess of Par-Common Stock 331 Retained Earnings 341 Cash Dividends 351 Treasury Stock 352 Paid-in Capital from Sale of Treasury Stock 361 Unrealized Gain (Loss) on Available-for-Sale Investments Labels and Amount Descriptions Labels Current assets abels Current assets Current liabilities December 31, Year 1 Dividends For the Year Ended December 31, Year 1 Intangible assets Investments Long-term liabilities Operating expenses Other revenue and expenses Paid-in capital Property, plant, and equipment Amount Descriptions Available-for-sale investments Decrease in retained earnings Gross profit Income before income tax Income from operations Increase in retained earnings Net income Net income Net loss Retained earnings, January 1, Year 1 Retained earnings, December 31, Year 1 Total administrative expenses Total Total assets Total current assets Total current liabilities Total liabilities Total liabilities and stockholders' equity Total long-term liabilities Total investments Total operating expenses Total paid-in capital Total property, plant, and equipment Total selling expenses Total stockholders' equity Income Statement Income Statement 1. A. Prepare a multiple-step income statement for the year ended December 31, Year 1, concluding with earnings per share. In computing earnings per share, assume that the average number of common shares outstanding was 100,000 and preferred dividends were $100,000. Enter all amounts as positive numbers EXCEPT in the Other income and expenses. In that section only, enter amounts that represent other expenses as negative numbers using a minus sign. Round earnings per share to the nearest cent. . Refer to the Chart of Accounts for exact wording of account titles Refer to the Labels and Amount Descriptions for exact wording of text entries. Equinox Products Inc. Income Statement (Label) 4 (Label) 5 Selling expenses: Retained Earnings Statement 2. B. Prepare a retained earnings statement for the year ended December 31, Year 1. Refer to the Chart of Accounts for exact wording of account titles. Refer to the Labels and Amount Descriptions for exact wording of text entries. You ill need to enter the word Less" or "Add" as necessary. Equinox Products, Indc. Retained Earnings Statement (Label) 3 Label)