Question
Sage Inc. experienced the following transactions for Year 1, its first year of operations: Issued common stock for $110,000 cash. Purchased $195,000 of merchandise on
Sage Inc. experienced the following transactions for Year 1, its first year of operations:
Issued common stock for $110,000 cash.
Purchased $195,000 of merchandise on account.
Sold merchandise that cost $168,000 for $334,000 on account.
Collected $296,000 cash from accounts receivable.
Paid $175,000 on accounts payable.
Paid $54,000 of salaries expense for the year.
Paid other operating expenses of $70,000.
Sage adjusted the accounts using the following information from an accounts receivable aging schedule:
| Number of Days Past Due | Amount | Percent Likely to Be Uncollectible | Allowance Balance | ||
| Current | $ | 22,800 | 0.01 | ||
| 030 | 9,500 | 0.05 | |||
| 3160 | 1,900 | 0.10 | |||
| 6190 | 1,900 | 0.20 | |||
| Over 90 days | 1,900 | 0.50 | |||
Required
Organize the transaction data in accounts under an accounting equation.
Prepare the income statement, statement of changes in stockholders equity, balance sheet, and statement of cash flows for Sage Inc. for Year 1.
What is the net realizable value of the accounts receivable at December 31, Year 1?
Organize the transaction data in accounts under an accounting equation. (Enter any decreases to account balances with a minus sign. If there is no effect on the Accounts Titles for Retained Earnings, leave the cell blank.)
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repare the income statement for Sage Inc. for Year 1.
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Prepare the statement of changes in stockholders equity for Sage Inc. for Year 1.
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Algorithm Audit Why What And How
Authors: Biagio Aragona
1st Edition
0367530929, 978-0367530921
