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Packet Exercise 6.3 Abu Enterprises sells carnival equipment. There are 10,000 shares of capital stock outstanding. The annual fiscal period ends on December 31. The

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Packet Exercise 6.3 Abu Enterprises sells carnival equipment. There are 10,000 shares of capital stock outstanding. The annual fiscal period ends on December 31. The following condensed trial balance was taken from the general ledger on December 31, 2017: Account Titles Debit Credit Cash Accounts receivable (net) Inventory, ending Operational assets 38,100 4.400 52,000 40,000 Liabilities Capital stock Retained eamings, January 1, 2017 16,800 24,900 72,000 9,280 141,000 Sales revenue Sales returns and allowances Sales Discount Credit Card Discount Loss on sale of land Cost of goods sold Selling expense Administrative expense 2,900 4,300 1,100 1,000 72,700 4.100 13,700 2,000 7,680 Bad debt expense Income tax expense Totals 263,980$ 263,980 Part A) Beginning with the amount for net sales returns and allowances as a contra-revenue sales, prepare an income statement. Treat sales discounts and Net sales revenue Cost of goods sold Gross profit Operating expenses Income from operations Other Income/Expense Income before taxes Income tax expense Net income Earnings per share Part B) The beginning balance in Accounts Receivable (net) was $20,000. Compute the receivables tunover ratio and number of days in accounts receivable. AR Turnover Ratio-Net Sales/Average Accounts Receivable Number of Days in AR -365/AR Turnover Ratio

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