Question
Supreme Videos, Inc. produces short musical videos for sale to retail outlets. The company's balance sheet as of January 1, the beginning of its fiscal
Supreme Videos, Inc. produces short musical videos for sale to retail outlets. The company's balance sheet as of January 1, the beginning of its fiscal year, are given below:
| Supreme Videos Inc. | ||
|---|---|---|
| Balance Sheet | ||
| January 1 | ||
| Assets | ||
| Current Assets: | ||
| Cash | $63,000 | |
| Account Receivable | 102.000 | |
| Inventories: | ||
| Raw materials (film, costumes | $30,000 | |
| Videos in process | 45,000 | |
| Finished videos awaiting sale | 81,000 | 156,000 |
| Prepaid insurance | 9,000 | |
| Total current assets | 330,000 | |
| Studio & equipment | 730,000 | |
| Less accumulated depreciation | 210,000 | 520,000 |
| Total Assets | $850,000 | |
| Liabilities & stockholders | equity | |
| Accounts payable | $160,000 | |
| Capital Stock | $420,000 | |
| Retained earnings | 270,000 | 690,000 |
| Total Liabilites & stockholders | equity | $850,000 |
| Because the videos differ in length and in complexity of production, the company uses a job-order costing system to determine the cost of each video produced. Studio (manufacturing) overhead is charged to videos on the basis of camera-hours of activity. The company |
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Principles Of Financial And Managerial Accounting Volume 2
Authors: Thomas D Hubbard
3rd Edition
0873934911, 978-0873934916
