Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

. Prepare a retained earnings statement for the year ended December 31, 20Y5. Be sure to complete the statement heading. Refer to the account names

. Prepare a retained earnings statement for the year ended December 31, 20Y5. Be sure to complete the statement heading. Refer to the account names in the instructions and the lists of Labels and Amount Descriptions for the exact wording of text entries. If a net loss is incurred or there is a decrease in owners equity, enter that amount as a negative number using a minus sign.
c.

Prepare a balance sheet in report form as of December 31, 20Y5. Be sure to complete the statement heading. Refer to the account names in the instructions and the lists of Labels and Amount Descriptions for the exact wording of text entries. Less or Add will automatically appear if it is required. For those boxes in which you must enter subtractive or negative numbers use a minus sign. Recall that current assets are to be reported in order of liquidity. Available-for-sale investments are considered to be more liquid than accounts receivable. Report fixed assets and paid-in capital accounts in account-number order. Omit the description of bonds and stocks (i.e., percentage rates, due date, number of shares, etc.).

Income Statement data:
Advertising expense $150,000
Cost of merchandise sold 3,700,000
Delivery expense 30,000
Depreciation expense-office buildings and equipment 30,000
Depreciation expense-store buildings and equipment 100,000
Gain on sale of investments 4,980
Income from Pinkberry Co. investment 76,800
Income tax expense 142,000
Interest expense 21,000
Interest revenue 8,720
Miscellaneous administrative expense 7,500
Miscellaneous selling expense 14,000
Office rent expense 50,000
Office salaries expense 170,000
Office supplies expense 10,000
Sales 5,254,000
Sales commissions expense 185,000
Sales salaries expense 385,000
Store supplies expense 21,000
Retained earnings and balance sheet data:
Accounts payable $194,300
Accounts receivable 545,000
Accumulated depreciation-office buildings and equipment 1,580,000
Accumulated depreciation-store buildings and equipment 4,126,000
Allowance for doubtful accounts 8,450
Available-for-sale investments (at cost) 260,130
Bonds payable, 5%, due in 10 years 500,000
Cash 246,000
Common stock, $20 par
(400,000 shares authorized; 100,000 shares issued, 94,600 outstanding) 2,000,000
Dividends:
Cash dividends for common stock 155,120
Cash dividends for preferred stock 100,000
Goodwill 500,000
Income tax payable 44,000
Interest receivable 1,125
Investment in Pinkberry Co. stock (equity method) 1,009,300
Investment in Dream Inc. bonds (long term) 90,000
Merchandise inventory (December 31, 20Y5),
at lower of cost (FIFO) or market 778,000
Office buildings and equipment 4,320,000
Paid-in capital from sale of treasury stock 13,000
Excess of issue price over par-common stock 886,800
Excess of issue price over par--preferred stock 150,000
Preferred $1 stock, $80 par
(30,000 shares authorized; 20,000 shares issued) 1,600,000
Premium on bonds payable 19,000
Prepaid expenses 27,400
Retained earnings, January 1, 20Y5 9,319,725
Store buildings and equipment 12,560,000
Treasury stock
(5,400 shares of common stock at cost of $33 per share) 178,200
Unrealized gain (loss) on available-for-sale investments (6,500)
Valuation allowance for available-for-sale investments (6,500)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Income Tax Fundamentals 2013

Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill

31st Edition

9781285586618

Students also viewed these Accounting questions

Question

Write out the first three terms in the expansion (x + y) 12 .

Answered: 1 week ago

Question

24. What effect does a lean production environment have on MRP?

Answered: 1 week ago