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Antioch Company makes eBook readers. The company had the following amounts at the beginning of Year 2 Cash $672,000, Raw Materials Inventory. $71000; Work In Process Inventory, $36,000; Finished Goods Inventory $62,000, Common Stock. $587,000, and Retained Earnings $254.000. Antioch experienced the following accouhting events during Year 2 Other than the adjusting entries for depreciation, assume that all transactions are cash transactions 1. Pald $33,000 of research and development costs 2. Paid $48,000 for raw materials that will be used to make eBook readers. 3. Placed $99.000 of the raw materials cost into the process of manufacturing eBook readers. 4 Paid $62,000 for salaries of selling and administrative employees 5. Pald $104,000 for wages of production workers 6 Paid $69.000 to purchase equipment used in selling and administrative offices 7 Recognized depreciation on the office equipment The equipment was acquired on January 1. Year 2. It has a $19,000 salvage value and a five year life. The amount of depreciation is computed as (Cost - salvage) - useful life) Specifically, ($69,000 8. Paid $166,000 to purchase manufacturing equipment. 9. Recognized depreciation on the manufacturing equipment. The equipment was acquired on January 1 Year 2. It has a $26.000 salvage value and a seven-year life The amount of depreciation is computed as Cost - salvage) - useful life) Specifically, ($166,000 - $26,000) = 7 * $20,000 10 Paid 552,000 for rent and utility costs on the manufacturing facility 11. Pald $72,000 for inventory holding expenses for completed eBook readers (rental of warehouse space, salonies of warehouse personnel, and other general storage cost) 12. Completed and transferred eBook readers that had total cost of $246,000 from work in process inventory to finished goods 13. Sold 880 eBook readers for $425,000 14. It Cost Antioch $184,800 to make the eBook readers sold in Event 13 Required: a. Show how these events affect the balance sheet, Income statement, and statement of cash flows by recording them in a horizontal financial statements model c-1. Prepare a schedule of cost of goods manufactured and sold for the year c-2. Prepare o formal income statement for the year C-3. Prepare o balance sheet for the year 50000 300 DO 000 DO 000 Co 00.000 - 20.000 1910001 Tour 154.00 14 200 100002 124000 - 23 72.000 TE 000 22.000- . 10 20,000 000 110.000 2 10000 Oo oo 000 0.000 000 O PO 2.000 - 4 - 000 . + 10000 OD DI 000 1000 2 1000 00 ODOS ST.000 - DOO DODE 1000 672.000 Com AN IV Olte Goode Fshed Materials SER NOM in het Aste Eront Check Prepare a schedule of cost of goods manufactured and sold for the year (Amounts to be deducted should be indicated with a minus sign ANTIOCH COMPANY Schedule of Cost of Goods Manufactured and Sold For the Year Ended December 31, Year 2 Beginning raw materials Inventory Purchases Raw materials available 0 Ending raw materials inventory Raw materials used 0 Labor Overhead Total manufacturing costs 0 Beginning work in process inventory Total work in process inventory 0 Ending work in process inventory Cost of goods manufactured Beginning nished goods inventory Goods viable Ending finished goods inventory Cost of goods sold 0 RegA Reg C2 > Prepare a formal income statement for the year. ANTIOCH COMPANY Income Statement For the Year Ended December 31, Year 2 ANTIOCH COMPANY Balance Sheet As of December 31, Year 2 Assets Z S Total assets Stockholders Equity Total stockholders equity
