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On December 31, 2016, the balances of the accounts appearing in the ledger of Wyman Company are as follows: Cash $13,500 Accounts Receivable 72,000 Merchandise
On December 31, 2016, the balances of the accounts appearing in the ledger of Wyman Company are as follows:
Cash | $13,500 |
Accounts Receivable | 72,000 |
Merchandise Inventory, January 1, 2016 | 257,000 |
Office Supplies | 3,000 |
Prepaid Insurance | 4,500 |
Land | 150,000 |
Store Equipment | 270,000 |
Accumulated Depreciation-Store Equipment | 55,900 |
Office Equipment | 78,500 |
Accumulated Depreciation-Office Equipment | 16,000 |
Accounts Payable | 27,800 |
Salaries Payable | 3,000 |
Unearned Rent | 8,300 |
Notes Payable | 50,000 |
Common Stock | 150,000 |
Retained Earnings | 430,500 |
Dividends | 25,000 |
Sales | 3,280,000 |
Purchases | 2,650,000 |
Purchases Returns and Allowances | 93,000 |
Purchases Discounts | 37,000 |
Freight In | 48,000 |
Sales Salaries Expense | 300,000 |
Advertising Expense | 45,000 |
Delivery Expense | 9,000 |
Depreciation Expense-Store Equipment | 6,000 |
Miscellaneous Selling Expense | 12,000 |
Office Salaries Expense | 175,000 |
Rent Expense | 28,000 |
Insurance Expense | 3,000 |
Office Supplies Expense | 2,000 |
Depreciation Expense-Office Equipment | 1,500 |
Miscellaneous Administrative Expense | 3,500 |
Rent Revenue | 7,000 |
Interest Expense | 2,000 |
Required: | ||||||||||||||||||||||||||||||||||||||||
1. | Does Wyman Company use a periodic inventory system or perpetual inventory system? Which account listed would not be used under both inventory systems? | |||||||||||||||||||||||||||||||||||||||
2. | Prepare a multiple-step income statement for Wyman Company for the year ended December 31, 2016. Be sure to complete the statement heading. The merchandise inventory as of December 31, 2016, was $305,000. Refer to the chart of accounts and the lists of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. Less, Add or colons (:) will automatically appear if required. In the Other income and expenses section only, enter amounts that represent other expenses as negative numbers using a minus sign. | |||||||||||||||||||||||||||||||||||||||
3. | Prepare the closing entries for Wyman Company as of December 31, 2016. Refer to the Chart of Accounts for exact wording of account titles. | |||||||||||||||||||||||||||||||||||||||
What would be the net income if the perpetual inventory system had been used? Labels & Amount Descriptions Labels:
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