Mo.11-C No outside help due Sep19 WORKSHEET PROVIDED Name 40pts Worksheet for Balance Sheet provided. NEW-Co's ending Month-10 Balance Sheet is Month-11's starting Balance Sheet. (Shown below) During the 11th month, the company has several transactions listed below. Analyze the activities and prepare the 11th period's income statement (below) and ending balance sheet. 1. NEW-Co sells $575,000 of inventory to customers for $820,000 net. $520,000 were cash sales, balance on credit due from credit customers in 30 days in next month's accounting period. 2. Office supplies and utilities expense together totaled $40,000, paid cash in the current period 3. Depreciation expense is $750 per month ($72,000 div. by 8 = $9,000 annual div. by 12 = $750 mo.) 4 NEW-Co buys $425,000 more inventory, pays $225,000 cash now, balance due to suppliers next month. Pays cash in Mo, 11 against all of starting balance owed in Accts Payable from Mo-10 Accts Payable. 5. Another $295,000 is received in Mo. 11 from payments made by customers who bought on credit in Mo.10 6. $40,000 is repaid on the Bank loan Mo. loan interest expense = $1,000, paid cash in current period. 7. Wage expense = $60,000, $40,000 in cash, balance paid next period. Mo-10 Wage Payable is paid cash now. 8. Amortized monthly insurance policies expense of $300 recorded in the current period 9. NEW-Co buys extra $230,000 inventory, pays $100,000 cash, balance on Supplier credit, due in Mo. 12 10. Building monthly rent paid cash in current period is $15,000 monthly going forward 11. $100,000 cash is collected early in the current Mo-11 period from current Mo.-11 purchases on credit 12. Dividends = $15,000 paid cash to Owner in Mo. 11 Month-11 Retained Earns = Mo. 11 N.Inc - $15,000 DIV 13. NEW-Co owes $31,950 in income tax on Mo.11 pre-tax profits, pays period 12. NEW pays Mo-10 Tax payable. Month11c START 11C Income Statemt Revenue Cost of goods GROSS PROFIT STARTING ASSETS CASH ACCT RECEIVABLE INVENTORY Prepaid Curr. Asset TOT CURR. ASSETS Month11c 87.5 332 528 .6 948.1 LIABIL & EQUITY WAGES PAYABLE SUPPLIER PAYABLE LOC BANK LOAN TAX. Oth PAYABLE 13 275 130 30 448 LT ASSETS Office Eq 64.5 CURR. LIABILITIES LONG TERM DEBT TOTAL LIABILITIES 0 448 TOTAL ASSETS 1012.6 Wages Exps Office Exps Depreciation Exps Insurance Exps Building Rent EBIT Interest Exps Pre-tax Income Income Tax NET INCOME OWNERS EQUITY RETAINED EARNS TOTAL EQUITY 200 364.6 564.6 1012.6 TOT LIABS & EQUITY Net Inc Dividends = Retained Earns Mo.11 Gross Profit Margin = Gr. Profit / Rev = Mo.11 Operating Profit Margin = EBIT/Rev = Mo. 11 Net Prof. Margin = Net Inc. / Rev = Mo.11 Return on Beginning Equity = Month - 110 Sep.19 Accts Red 332.0 Solution Worksheet NET LT TOTAL Assets ASSET 64.5 1012.6 Other Curr. 0.6 EXAM1 - Mo11C Accts Loan Payol Poyable 275 130 Cash 87.5 Wage Payable 13 Owner Equity 200 Inven 528,0 Month - 110 TOT UAB Tot Equity EQUITY 5646 1,012.6 Uobs 30 Ret Earns 364.6 Item 1 2 3 4 5 6 7 8 9 10 11 12 13 Total Accum Deprec., Amort. Current Assets Current Liabilities WORKING CAPITAL
