Required information

[The following information applies to the questions displayed below.] Prat Corp. started the 2018 accounting period with $31,000 of assets (all cash), $12,500 of liabilities, and $6,000 of common stock. During the year, the Retained Earnings account increased by $8,550. The bookkeeper reported that Prat paid cash expenses of $26,500 and paid a $2,100 cash dividend to the stockholders, but she could not find a record of the amount of cash that Prat received for performing services. Prat also paid $4,000 cash to reduce the liability owed to the bank, and the business acquired $6,900 of additional cash from the issue of common stock.

Required

(Hint: Determine the amount of beginning retained earnings before considering the effects of the current period events. It also might help to record all events under an accounting equation before preparing the statements.)

1. a-1. Prepare an income statement for the 2018 accounting period.
2. a-2. Prepare a statement of changes in stockholders equity for the 2018 accounting period.
3. a-3. Prepare a period-end balance sheet for the 2018 accounting period.
4. a-4. Prepare a statement of cash flows for the 2018 accounting period.

Complete this question by entering your answers in the tabs below.

• Req A1
• Req A2
• Req A3
• Req A4

Prepare an income statement for the 2018 accounting period.

Prat Corp.
Income Statement
For the Year Ended December 31, 2018
Revenues
Expenses
Net income

Complete this question by entering your answers in the tabs below.

• Req A1
• Req A2
• Req A3
• Req A4

Prepare a statement of changes in stockholders' equity for the 2018 accounting period.

Prat Corp.
Statement of Changes in Stockholders Equity
For the Year Ended December 31, 2018
Beginning common stock
Plus: Common stock issued
Ending common stock
Beginning retained earnings
Plus: Net income
Less: Dividend
Ending retained earnings
Total stockholders equity

Prepare a period-end balance sheet for the 2018 accounting period.

Prat Corp.
Balance Sheet
As of December 31, 2018
Assets
Total assets		$0
Liabilities
Stockholders' Equity
Total stockholders' equity		0
Total liabilities and stockholders' equity		$0

Prat Corp.
Statement of Cash Flows
For the Year Ended December 31, 2018
Cash flows from operating activities:
Net cash flow from operating activities		$0
Cash flows from investing activities
Cash flows from financing activities:
Net cash flow from financing activities		0
Ending cash balance		$0

Franklin Manufacturing Company was started on January 1, 2018, when it acquired $85,000 cash by issuing common stock. Franklin immediately purchased office furniture and manufacturing equipment costing $9,800 and $35,500, respectively. The office furniture had an eight-year useful life and a zero salvage value. The manufacturing equipment had a $3,900 salvage value and an expected useful life of four years. The company paid $11,900 for salaries of administrative personnel and $15,100 for wages to production personnel. Finally, the company paid $9,340 for raw materials that were used to make inventory. All inventory was started and completed during the year. Franklin completed production on 4,200 units of product and sold 3,250 units at a price of $15 each in 2018. (Assume that all transactions are cash transactions and that product costs are computed in accordance with GAAP.)

Required

1. Determine the total product cost and the average cost per unit of the inventory produced in 2018. (Round "Average cost per unit" to 2 decimal places.)

2. Determine the amount of cost of goods sold that would appear on the 2018 income statement. (Do not round intermediate calculations.)

3. Determine the amount of the ending inventory balance that would appear on the December 31, 2018, balance sheet. (Do not round intermediate calculations.)

4. Determine the amount of net income that would appear on the 2018 income statement. (Round your answer to the nearest dollar amount.)

5. Determine the amount of retained earnings that would appear on the December 31, 2018, balance sheet. (Round your answer to the nearest dollar amount.)

6. Determine the amount of total assets that would appear on the December 31, 2018, balance sheet. (Round your answer to the nearest dollar amount.)

Required information

[The following information applies to the questions displayed below.]

Antioch Company makes eBook readers. The company had the following amounts at the beginning of 2018: Cash, $667,000; Raw Materials Inventory, $51,000; Work in Process Inventory, $36,000; Finished Goods Inventory, $48,000; Common Stock, $586,000; and Retained Earnings, $216,000. Antioch experienced the following accounting events during 2018. Other than the adjusting entries for depreciation, assume that all transactions are cash transactions.

1. Paid $24,000 of research and development costs.

2. Paid $61,000 for raw materials that will be used to make eBook readers.

3. Placed $85,000 of the raw materials cost into the process of manufacturing eBook readers.

4. Paid $69,000 for salaries of selling and administrative employees.

5. Paid $104,000 for wages of production workers.

6. Paid $78,000 to purchase equipment used in selling and administrative offices.

7. Recognized depreciation on the office equipment. The equipment was acquired on January 1, 2018. It has a $18,000 salvage value and a six-year life. The amount of depreciation is computed as [(Cost salvage) useful life]. Specifically, ($78,000 $18,000) 6 = $10,000.

8. Paid $112,000 to purchase manufacturing equipment.

9. Recognized depreciation on the manufacturing equipment. The equipment was acquired on January 1, 2018. It has a $28,000 salvage value and a seven-year life. The amount of depreciation is computed as [(Cost salvage) useful life]. Specifically, ($112,000 $28,000) 7 = $12,000.

10. Paid $58,000 for rent and utility costs on the manufacturing facility.

11. Paid $75,000 for inventory holding expenses for completed eBook readers (rental of warehouse space, salaries of warehouse personnel, and other general storage cost).

12. Completed and transferred eBook readers that had total cost of $242,000 from work in process inventory to finished goods.

13. Sold 950 eBook readers for $422,000.

14. It cost Antioch $161,500 to make the eBook readers sold in Event 13.

1. c-1. Prepare a schedule of cost of goods manufactured and sold for the year. (Amounts to be deducted should be indicated with a minus sign.)

1. c-2. Prepare a formal income statement for the year.

1. c-3. Prepare a balance sheet for the year.

ANTIOCH COMPANY Schedule of Cost of Goods Manufactured and Sold For the Year Ended December 31, 2018 Beginning raw materials Inventory Purchases Raw materials available 0 Ending raw materials inventory Raw materials used 0 Labor Overhead Total manufacturing costs 0 Beginning work in process inventory Total work in process inventory 0 Ending work in process inventory Cost of goods manufactured 0 Beginning finished goods inventory Goods available 0 Ending finished goods inventory Cost of goods sold $ 0 ANTIOCH COMPANY Income Statement For the Year Ended December 31, 2018 ANTIOCH COMPANY Balance Sheet As of December 31, 2018 Assets $ 0 Total assets Stockholders' Equity Total stockholders' equity $ 0