P2.3 Understanding the accounting equation (LO 2-12) Required: Following is selected information from the balance sheet for Flaps Ine. Solve for the missing amounts for each of the five years. Year 20x3 20x1 $13.765 A 138 2.140 8.667 2.795 20x4 P $3.517 142 2.422 8.968 Total liabilities and stockholders' equity Current liabilities Common stock Contributed capital Noncurrent assets Retained earnings Total assets Noncurrent liabilities Additional paid-in capital Current assets Total liabilities Total stockholders' equity 20x2 F $3.420 139 G 8,721 2.813 H 1 2.216 J 8,683 5.168 $1,467 L 22287 M 2.851 14,040 5115 2247 5.200 N 0 20x5 u V $ 144 w X Y 14.351 5.454 2.296 5.315 Z 5.354 5.231 D R S T $.275 8929 5.314 8630 E Comments: 1 One thing to keep in mind is that contributed capital is the total of Common Stock and Additional Paid in Capital like this: Common Stock 100 Additional Paid in Capital 100 "Total Contributed Capital 200 Retained Earnings 100 Totar Shareholders' Equity 300 2. Retained Earnings (end of year) - Retained Earnings (beginning of year) + Net Income - Dividends P2-4 Understanding the accounting equation (LO 2-12) The following is selected information from Bob Touret, Inc.'s financial statements. Solve for the missing amounts for each of the five years. You may have to use some numbers from the year before or the year after to solve for certain current year numbers. (NA = not available.) Year 20X1 20x2 20x3 20x4 20x5 Current assets (CA) $2,736 L $2.778 X Noncurrent assets $4,002 F $3,900 R $4.805 Total assets 6,748 G M 7,008 Y Current liabilities (CL) 1.536 N S 1.463 Noncurrent liabilities B 2.345 o 2.206 2.252 Contributed capital 1.250 1 P 1.300 Z Retained earnings (ending) 1.750 1,756 T 1924 Total stockholders' equity 3.091 3,056 U AA Total liabilities and stockholders' equity D K 6,916 7008 BB Working capital (CA-CL) E 935 1.331 V 771 Net income (less) NA 105 Q 35 135 Dividends NA 14 9 w 12 Comments: 1. The definitional equation for the balance sheet is: Total Assets = Total Liabilities - Total Shareholders equity 2. The Total Shareholders' equity is broadly speaking, Contributed Capital (What the shareholders put in) and Retained Earning (the profits made and still in the company Total Shareholders' equity = Contributed Capital + Retained Earnings 3. Retained Earnings carries over from year to year, so that Retained Earnings (beginning). Net Income - Dividends = Retained Eamings (ending) The implication of 3. For Tis this: T + Net Income - Dividends = Retained Earnings (ending) T +135 . 12 = 1,924 P2-5 Converting from cash to accrual basis LO 2.1. LO 2-12) : During August 20X1. Packer Manufacturing had the following cash receipts and disbursemen Cash received from customers $319,000 Cash received from selling equipment 11.200 Cash paid for salaries 47.000 Cash paid to suppliers for inventory purchases 130,000 In addition, the following balance sheet account balances were shown on Packer's books July 31, 20X1 August 31, 20X1 Accounts receivable $128.000 $135.000 Inventory 33,000 25,000 Accounts payable 21.000 25,000 Salaries payable 8,000 5.000 Assume all sales and purchases are on account. Required: 1. Determine sales for August 20X1. 2. Determine salary expense for August 20X1. 3. Determine cost of goods sold for August 20X1