Question
Required: 2. After all of the transactions for the year ended December 31, 20Y5, had been posted [including the transactions recorded in part (1) and
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2. | After all of the transactions for the year ended December 31, 20Y5, had been posted [including the transactions recorded in part (1) and all adjusting entries], the data that follows were taken from the records of Equinox Products Inc.
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Income Statement data: | |
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Advertising expense | $150,000 |
Cost of merchandise sold | 3,700,000 |
Delivery expense | 30,000 |
Depreciationexpense-officebuildingsandequipment | 30,000 |
Depreciationexpense-storebuildingsandequipment | 100,000 |
Gain on sale of investments | 4,980 |
IncomefromPinkberry 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: | |
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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 | |
(400,000sharesauthorized;100,000sharesissued,94,600outstanding) | 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 |
InvestmentinPinkberryCo.stock(equitymethod) | 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 | |
(5,400sharesofcommonstockatcostof$33pershare) | 178,200 |
Unrealizedgain(loss)onavailable-for-saleinvestments | (6,500) |
Valuation allowance for available-for-sale investments | (6,500) |
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