Question
Widgets R Us Inc. Net Income Worksheet Post-Closing Unadjusted Adjusted Income Statement Balance Sheet Trial Balance 2017 Transaction Entries Trial Balance 2017 Adjusting Entries Trial
Widgets R Us Inc. | |||||||||||||||||
Net Income | |||||||||||||||||
Worksheet | |||||||||||||||||
Post-Closing | Unadjusted | Adjusted | Income Statement | Balance Sheet | |||||||||||||
Trial Balance | 2017 Transaction Entries | Trial Balance | 2017 Adjusting Entries | Trial Balance | For the Year Ended 12/31/17 | 12/31/2017 | |||||||||||
Note: 12/31/2016 is equivalent to 1/1/2017 | 12/31/2016 | Dr. | Cr. | 12/31/2017 | Dr. | Cr. | 12/31/2017 | Dr. | Cr. | Dr. | Cr. | ||||||
Cash | $2,136 | 1 | $13,000 | 6 | $490 | $178 | 8a | 10 | 8b | 3 | $175 | $175 | |||||
3 | 1,775 | 9 | 48,400 | 8c | 10 | ||||||||||||
5 | 50,725 | 10 | 336 | ||||||||||||||
11 | 1,750 | 12 | 12,050 | ||||||||||||||
15 | 1,320 | 13 | 1,193 | ||||||||||||||
14 | 1,325 | ||||||||||||||||
16 | 1,716 | ||||||||||||||||
17 | 10 | ||||||||||||||||
18 | 8 | ||||||||||||||||
19 | 5,000 | ||||||||||||||||
Petty Cash | 17 | 10 | |||||||||||||||
18 | 2 | 12 | 12 | 12 | |||||||||||||
Certificate of Deposit | 19 | 5,000 | 5,000 | 5,000 | 5,000 | ||||||||||||
Accounts Receivable | 1,650 | 1 | 56,250 | 2 | 200 | 0 | 0 | ||||||||||
3 | 1,775 | ||||||||||||||||
4 | 750 | ||||||||||||||||
5 | 51,650 | 3,525 | 3,525 | 3,525 | |||||||||||||
Allowance for Uncollectibles | -36 | 2 | 200 | 164 | 1 | $269 | -105 | $105 | |||||||||
Interest Receivable | 7 | 25 | 25 | 25 | |||||||||||||
Merchandise Inventory | 3,100 | 3,100 | 2 | 1,510 | 4,610 | 4,610 | |||||||||||
Prepaid Insurance | 154 | 10 | 336 | 490 | 3 | 329 | 161 | 161 | |||||||||
0 | 0 | ||||||||||||||||
Building | 5,100 | 5,100 | 5,100 | 5,100 | |||||||||||||
Accumulated Depreciation - Building | -765 | -765 | 4 | 255 | -1,020 | 1,020 | |||||||||||
Furniture & Fixtures | 2,000 | 2,000 | 2,000 | 2,000 | |||||||||||||
Accumulated Depreciation - Furniture & Fixtures | -1,200 | -1,200 | 4 | 400 | -1,600 | 1,600 | |||||||||||
Computer Equipment | 4,500 | 4,500 | 4,500 | 4,500 | |||||||||||||
Accumulated Depreciation - Computer Equipment | -900 | -900 | 4 | 900 | -1,800 | 1,800 | |||||||||||
Copier | 375 | 375 | 375 | 375 | |||||||||||||
Accumulated Depreciation - Copier | -125 | -125 | 4 | 125 | -250 | 250 | |||||||||||
Accounts Payable | -3,450 | 8 | 1,000 | 7 | 47,500 | ||||||||||||
9 | 48,400 | -1,550 | -1,550 | 1,550 | |||||||||||||
Note Payable | -1,500 | 16 | 1,500 | 0 | 0 | 0 | |||||||||||
Salaries Payable | -240 | 12 | 240 | 0 | 5 | 245 | -245 | 245 | |||||||||
Interest Payable | -216 | 16 | 216 | 0 | 0 | 0 | |||||||||||
Income Tax Payable | -1,193 | 13 | 1,193 | 0 | 9 | 3,521 | -3,521 | 3,521 | |||||||||
Unearned Rent Revenue | -260 | 15 | 1,320 | -1,580 | 6 | $1,024 | -556 | 556 | |||||||||
Common Stock ($10 Par Value) | -2,400 | 11 | 250 | -2,650 | -2,650 | 2,650 | |||||||||||
Additional Paid-in-Capital | -4,000 | 11 | 1,500 | -5,500 | -5,500 | 5,500 | |||||||||||
Retained Earnings | -2,730 | -2,730 | -2,730 | 2,730 | |||||||||||||
Dividends Declared | 0 | 14 | 1,325 | 1,325 | 1,325 | 1,325 | |||||||||||
Sales Revenue | 0 | 1 | 69,250 | -69,250 | -69,250 | $69,250 | |||||||||||
Sales Discounts | 5 | 925 | 6 | 10 | 915 | 915 | 915 | ||||||||||
Sales Returns and Allowances | 4 | 750 | |||||||||||||||
6 | 500 | 1,250 | 1,250 | 1,250 | |||||||||||||
Purchases | 0 | 7 | 47,500 | 47,500 | 2 | 47,500 | 0 | ||||||||||
Purchase Returns and Allowances | 8 | 1,000 | -1,000 | 2 | 1,000 | ||||||||||||
Cost of Goods Sold | 0 | 0 | 2 | 44,990 | 44,990 | $44,990 | |||||||||||
Salaries Expense | 0 | 12 | 4,135 | 4,135 | 5 | 245 | 4,380 | 4,380 | |||||||||
Administrative Expense | 0 | 12 | 5,500 | 8b | 3 | 0 | |||||||||||
18 | 6 | 5,506 | 5,509 | 5,509 | |||||||||||||
Selling Expense | 0 | 12 | 2,175 | 2,175 | 8c | 10 | 2,185 | 2,185 | |||||||||
Bad Debt Expense | 0 | 0 | 1 | 269 | 269 | 269 | |||||||||||
Insurance Expense | 0 | 0 | 3 | 329 | 329 | 329 | |||||||||||
Depreciation Expense | 0 | 0 | 4 | 1,680 | 1,680 | 1,680 | |||||||||||
Interest Expense | 0 | ||||||||||||||||
Interest Revenue | 7 | 25 | |||||||||||||||
8a | 10 | -35 | $35 | ||||||||||||||
Rent Revenue | 0 | 6 | 1,024 | -1,024 | 1,024 | ||||||||||||
Income Tax Expense | 0 | 9 | 3,521 | 3,521 | 3,521 | ||||||||||||
0 | |||||||||||||||||
TOTAL | $0 | $245,733 | $245,733 | $0 | $54,616 | $54,616 | $0 | $65,028 | $70,309 | $26,808 | $21,527 | ||||||
Net Income | $5,281 | $5,281 | |||||||||||||||
$70,309 | $70,309 | $26,808 | $26,808 |
Part B: Extra Credit (19 Possible Points) - Due Thursday, May 4
(You must submit printouts of your work):
Prepare the required comparative financial statements for Widgets R Us, Inc. (the current year, 2017, should be on the left). Use the financial statements provided in the
solution to Practice Set 1B as your starting point.
The 2016 and 2017 income statements should be condensed, multiple-step in form, and classify their operating expenses into selling and administrative. Show the COGS, Selling Expense, and Administrative Expense calculations in separate schedules that support their respective one lines found on the condensed income statement. The payroll is 60% selling and 40% administrative. The insurance expense is 90% administrative and 10% selling. The depreciation expense on machinery is a selling expense, and the depreciation expense on the building and copier is an administrative expense. Bad debt expense is a selling expense.
Prepare simple statements of retained earnings for 2017 and 2016.
Prepare classified balance sheets at the end of 2017 and 2016 with Cash and Cash Equivalents in the first line of the current asset section. Include common stock information in the equity section (refer to the 2016 solution).
Prepare a complete statement of cash flows for 2017 and 2016. Use the direct
method to report cash flows from operating activities and the transaction-based statement of cash flows introduced earlier in this course. Tie out cash and cash equivalents as shown on the balance sheet not just the checking account balance
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