Required information The following information applies to the questions displayed below The comparative balance sheets for 2021 and 2020 and the income statement for 2021 are given below for Arduous Company Additional information from Arduouss accounting records is provided also ARDUOUS COMPANY Comparative Balance Sheets December 31, 2021 and 2020 ($ in millions) 2021 2020 Assets Cash $ 214 $ 90 Accounts receivable 199 203 Investment revenue receivable 15 13 Inventory 214 209 Prepaid insurance 13 17 Long term investment 156 125 Land 205 159 Buildings and equipment 459 409 Less Accumulated depreciation (106 ) (129 ) Patent 47 49 $ 1,416 $ 1,145 Liabilities Accounts payable $ 59 $ 83 Salaries payable 15 20 Interest payable (bonds) 17 13 Income tax payable 21 23 Deferred tax liability 20 17 Notes payable 23 0 Lease liability 113 0 Bonds payable 224 284 Less Discount on bonds (23 ) (26 ) Shareholders Equity Common stock 430 410 Paid in capitalexcess of par 124 112 Preferred stock 84 0 Retained earnings 318 209 Less Treasury stock (9 ) 0 $ 1,416 $ 1,145 ARDUOUS COMPANY Income Statement For Year Ended December 31, 2021 ($ in millions) Revenues and gain Sales revenue $ 595 Investment revenue 38 Gain on sale of treasury bills 2 $ 635 Expenses and loss Cost of goods sold 189 Salaries expense 82 Depreciation expense 12 Amortization expense 2 Insurance expense 16 Interest expense 37 Loss on sale of equipment 19 Income tax expense 45 402 Net income $ 233 Additional information from the accounting records Investment revenue includes Arduous Companys $6 million share of the net income of Demur Company, an equity method investee Treasury bills were sold during 2021 at a gain of $2 million Arduous Company classifies its investments in Treasury bills as cash equivalents Equipment originally costing $70 million that was one half depreciated was rendered unusable by a flood Most major components of the equipment were unharmed and were sold for $16 million Temporary differences between pretax accounting income and taxable income caused the deferred tax liability to increase by $3 million The preferred stock of Tory Corporation was purchased for $25 million as a long term investment Land costing $46 million was acquired by issuing $23 million cash and a 15 , four year, $23 million note payable to the seller The right to use a building was acquired with a 15 year lease agreement present value of lease payments, $120 million Annual lease payments of $7 million are paid at the beginning of each year starting January 1, 2021 $60 million of bonds were retired at maturity In February, Arduous issued a stock dividend (4 million shares) The market price of the $5 par value common stock was $8 per share at that time In April, 1 million shares of common stock were repurchased as treasury stock at a cost of $9 million rev 05 08 2020 QC CS 210569 Required Prepare the T accounts for Arduous Company (Enter your answers in thousands (i e , 10,000 should be entered as 10) ) Required Prepare the T accounts for Arduous Company (Enter your answers in thousands (l e , 10,000 should be entered as 10) ) Cash Beg Bal Operating Activities Investing Activities Financing Activities End Bal Accounts Receivable Inventory Beg Bal Beg Bal End Bal End Bal Prepaid Insurance Investment Revenue Receivable Beg Bal Beg Bal Long term Investments Land Beg Bal Beg Bal End Bal End Bal Buildings and Equipment Accumulated Depreciation Beg Bal Beg Bal End Bal End Bal Patent Accounts Payable Beg Bal Beg Bal End Bal End Bal Salaries Payable Interest Payable Beg Bal Beg Bal End Bal End Bal Income Tax Payable Deferred Tax Liability Beg Bal Beg Bal End Bal End Bal Notes Payable Lease Liability Notes Payable Lease Liability Beg Bal Beg Bal End Bal End Bal Bonds Payable Discount on Bonds Beg Bal Beg Bal End Bal End Bal Common Stock Paid in Capital Beg Bal Beg Bal End Bal End Bal Preferred Stock Retained Earnings Beg Bal Beg Bal End Bal End Bal Treasury Stock Sales Beg Bal Beg Bal End Bal End Bal Investment Revenue Gain on Sale of Treasury Bills Required information Investment Revenue Gain on Sale of Treasury Bills Beg Bal Beg Bal End Bal End Bal Cost of Goods Sold Salaries Expense Beg Bal Beg Bal End Bal End Bal Depreciation Expense Amortization Expense Beg Bal Beg Bal End Bal End Bal Insurance Expense Interest Expense Beg Bal Beg Bal End Bal End Bal Income Tax Expense Loss on Sale of Equipment Beg Bal Beg Bal End Bal End Bal Net Income (Income Summary) Beg Bal End Bal Required Prepare the T accounts for Arduous Company (Enter your answers in thousands (l e , 10,000 should be entered as 10) ) Cash Beg Bal Operating Activities Investing Activities Financing Activities End Bal Accounts Receivable Inventory Beg Bal Beg Bal End Bal End Bal Prepaid Insurance Investment Revenue Receivable Beg Bal Beg Bal Long term Investments Land Beg Bal Beg Bal End Bal End Bal Buildings and Equipment Accumulated Depreciation Beg Bal Beg Bal End Bal End Bal Patent Accounts Payable Beg Bal Beg Bal End Bal End Bal Salaries Payable Interest Payable Beg Bal Beg Bal End Bal End Bal Income Tax Payable Deferred Tax Liability Beg Bal Beg Bal End Bal End Bal Notes Payable Lease Liability Notes Payable Lease Liability Beg Bal Beg Bal End Bal End Bal Bonds Payable Discount on Bonds Beg Bal Beg Bal End Bal End Bal Common Stock Paid in Capital Beg Bal Beg Bal End Bal End Bal Preferred Stock Retained Earnings Beg Bal Beg Bal End Bal End Bal Treasury Stock Sales Beg Bal Beg Bal End Bal End Bal Investment Revenue Gain on Sale of Treasury Bills Required information Investment Revenue Gain on Sale of Treasury Bills Beg Bal Beg Bal End Bal End Bal Cost of Goods Sold Salaries Expense Beg Bal Beg Bal End Bal End Bal Depreciation Expense Amortization Expense Beg Bal Beg Bal End Bal End Bal Insurance Expense Interest Expense Beg Bal Beg Bal End Bal End Bal Income Tax Expense Loss on Sale of Equipment Beg Bal Beg Bal End Bal End Bal Net Income (Income Summary) Beg Bal End Bal

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Required information [The following information applies to the questions displayed below.] The comparative balance sheets for 2021 and 2020 and the income statement for 2021

Required information

[The following information applies to the questions displayed below.] The comparative balance sheets for 2021 and 2020 and the income statement for 2021 are given below for Arduous Company. Additional information from Arduouss accounting records is provided also.

ARDUOUS COMPANY Comparative Balance Sheets December 31, 2021 and 2020 ($ in millions)
	2021			2020
Assets
Cash	$	214		$	90
Accounts receivable		199			203
Investment revenue receivable		15			13
Inventory		214			209
Prepaid insurance		13			17
Long-term investment		156			125
Land		205			159
Buildings and equipment		459			409
Less: Accumulated depreciation		(106	)		(129	)
Patent		47			49
	$	1,416		$	1,145
Liabilities
Accounts payable	$	59		$	83
Salaries payable		15			20
Interest payable (bonds)		17			13
Income tax payable		21			23
Deferred tax liability		20			17
Notes payable		23			0
Lease liability		113			0
Bonds payable		224			284
Less: Discount on bonds		(23	)		(26	)
Shareholders Equity
Common stock		430			410
Paid-in capitalexcess of par		124			112
Preferred stock		84			0
Retained earnings		318			209
Less: Treasury stock		(9	)		0
	$	1,416		$	1,145

ARDUOUS COMPANY Income Statement For Year Ended December 31, 2021 ($ in millions)
Revenues and gain:
Sales revenue	$	595
Investment revenue		38
Gain on sale of treasury bills		2	$	635
Expenses and loss:
Cost of goods sold		189
Salaries expense		82
Depreciation expense		12
Amortization expense		2
Insurance expense		16
Interest expense		37
Loss on sale of equipment		19
Income tax expense		45		402
Net income			$	233

Additional information from the accounting records:

Investment revenue includes Arduous Companys $6 million share of the net income of Demur Company, an equity method investee.
Treasury bills were sold during 2021 at a gain of $2 million. Arduous Company classifies its investments in Treasury bills as cash equivalents.
Equipment originally costing $70 million that was one-half depreciated was rendered unusable by a flood. Most major components of the equipment were unharmed and were sold for $16 million.
Temporary differences between pretax accounting income and taxable income caused the deferred tax liability to increase by $3 million.
The preferred stock of Tory Corporation was purchased for $25 million as a long-term investment.
Land costing $46 million was acquired by issuing $23 million cash and a 15%, four-year, $23 million note payable to the seller.
The right to use a building was acquired with a 15-year lease agreement; present value of lease payments, $120 million. Annual lease payments of $7 million are paid at the beginning of each year starting January 1, 2021.
$60 million of bonds were retired at maturity.
In February, Arduous issued a stock dividend (4 million shares). The market price of the $5 par value common stock was $8 per share at that time.
In April, 1 million shares of common stock were repurchased as treasury stock at a cost of $9 million.

rev: 05_08_2020_QC_CS-210569

Required: Prepare the T-accounts for Arduous Company. (Enter your answers in thousands. (i.e., 10,000 should be entered as 10).)

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Required: Prepare the T-accounts for Arduous Company. (Enter your answers in thousands. (l.e., 10,000 should be entered as 10).) Cash Beg. Bal. Operating Activities: Investing Activities: Financing Activities: End. Bal. Accounts Receivable Inventory Beg. Bal. Beg. Bal End. Bal. End. Bal. Prepaid Insurance Investment Revenue Receivable Beg. Bal. Beg. Bal. Long-term Investments Land Beg Bal. Beg. Bal End. Bal. End. Bal. Buildings and Equipment Accumulated Depreciation Beg. Bal. Beg. Bal End. Bal. End. Bal Patent Accounts Payable Beg. Bal. Beg. Bal End. Bal. End. Bal. Salaries Payable Interest Payable Beg. Bal Beg. Bal End. Bal. End. Bal. Income Tax Payable Deferred Tax Liability Beg. Bal. Beg. Bal End. Bal. End. Bal Notes Payable Lease Liability Notes Payable Lease Liability Beg. Bal. Beg. Bal End. Bal End. Bal. Bonds Payable Discount on Bonds Beg. Bal. Beg. Bal End. Bal. End. Bal. Common Stock Paid-in Capital Beg. Bal. Beg Bal End. Bal End. Bal Preferred Stock Retained Earnings Beg. Bal. Beg. Bal End. Bal End. Bal. Treasury Stock Sales Beg. Bal. Beg. Bal. End. Bal. End. Bal. Investment Revenue Gain on Sale of Treasury Bills Required information Investment Revenue Gain on Sale of Treasury Bills Beg. Bal Beg. Bal. End. Bal End. Bal Cost of Goods Sold Salaries Expense Beg. Bal. Beg. Bal. End. Bal. End. Bal. Depreciation Expense Amortization Expense Beg. Bal Beg. Bal. End. Bal End. Bal. Insurance Expense Interest Expense Beg. Bal. Beg. Bal End. Bal. End. Bal. Income Tax Expense Loss on Sale of Equipment Beg. Bal. Beg. Bal. End. Bal End. Bal. Net Income (Income Summary) Beg. Bal End. Bal. Required: Prepare the T-accounts for Arduous Company. (Enter your answers in thousands. (l.e., 10,000 should be entered as 10).) Cash Beg. Bal. Operating Activities: Investing Activities: Financing Activities: End. Bal. Accounts Receivable Inventory Beg. Bal. Beg. Bal End. Bal. End. Bal. Prepaid Insurance Investment Revenue Receivable Beg. Bal. Beg. Bal. Long-term Investments Land Beg Bal. Beg. Bal End. Bal. End. Bal. Buildings and Equipment Accumulated Depreciation Beg. Bal. Beg. Bal End. Bal. End. Bal Patent Accounts Payable Beg. Bal. Beg. Bal End. Bal. End. Bal. Salaries Payable Interest Payable Beg. Bal Beg. Bal End. Bal. End. Bal. Income Tax Payable Deferred Tax Liability Beg. Bal. Beg. Bal End. Bal. End. Bal Notes Payable Lease Liability Notes Payable Lease Liability Beg. Bal. Beg. Bal End. Bal End. Bal. Bonds Payable Discount on Bonds Beg. Bal. Beg. Bal End. Bal. End. Bal. Common Stock Paid-in Capital Beg. Bal. Beg Bal End. Bal End. Bal Preferred Stock Retained Earnings Beg. Bal. Beg. Bal End. Bal End. Bal. Treasury Stock Sales Beg. Bal. Beg. Bal. End. Bal. End. Bal. Investment Revenue Gain on Sale of Treasury Bills Required information Investment Revenue Gain on Sale of Treasury Bills Beg. Bal Beg. Bal. End. Bal End. Bal Cost of Goods Sold Salaries Expense Beg. Bal. Beg. Bal. End. Bal. End. Bal. Depreciation Expense Amortization Expense Beg. Bal Beg. Bal. End. Bal End. Bal. Insurance Expense Interest Expense Beg. Bal. Beg. Bal End. Bal. End. Bal. Income Tax Expense Loss on Sale of Equipment Beg. Bal. Beg. Bal. End. Bal End. Bal. Net Income (Income Summary) Beg. Bal End. Bal