The Chief Financial Officer of What SUP, Inc. has asked you to develop a workboo
ID: 2592658 • Letter: T
Question
The Chief Financial Officer of What SUP, Inc. has asked you to develop a workbook, that includes an entire set of Financial Statements.
The end result should include an Income Statement, Statement of Retained Earnings, and Balance Sheet.
FINANCIALS - Financial Statement Preparation
6/30/14
Accounts payable $764.80
Accounts receivable ?
Accumulated depreciation - buildings $512.80
Accumulated depreciation - fixtures $689.60
Advances from customers $21.00 Advertising expense
$271.00 Allowance for bad debts $12.60
Bad debt expense $23.00
Bonds payable (due 9/1/20) $916.60
Buildings $1,166.40
Cash $112.80
Common stock $470.40
Copyrights $20.80
Cost of goods sold $5,727.80
Depreciation expense $227.80
Discontinued operations loss (net of tax) $376.60
Dividends declared on common $201.80
Dividends declared on preferred $21.20
Fixtures $1,789.40
Gain on the sale of old fixtures $108.80
Goodwill $106.80
Income tax expense $280.20
Income tax payable $75.00
Interest expense $77.60
Interest payable $14.20
Inventories $690.20
Land $201.80
Long-term notes payable $99.40
Other operating expenses $691.20
Paid in capital in excess of par $361.40
Preferred stock $265.80
Prepaid advertising $65.60
Retained earnings (beginning of year) $613.00
Salaries expense $1,246.20
Salaries payable $121.20
Sales $9,173.20
Short-term investments $267.80
Short-term notes payable $9.40
Supplies expense $256.40
Treasury stock (at cost) $228.20
I have laid out these balances within the Balance Sheet, Income Statement and Statement of Retained Earnings. I am posting this question as I am not balancing out on the Balance Sheet.
Explanation / Answer
Income statement Sales 9173.2 Cost of goods sold 5727.8 Gross margin 3445.4 operating expenses Salaries expense 1246.2 Bad debts expense 23 Advertising expense 271 Depreciation expense 227.8 Supplies expense 256.4 Interest expense 77.6 Other operating expenses 691.2 Total operating expenses 2793.2 Operating Income 652.2 Other Income & expenses Gain on sale of old fixtures 108.8 Income from continuing operations 761 Loss from discontinued operations -376.6 Net Income before taxes 384.4 Income tax expense 280.2 Net Income 104.2 Statement of retained earnings beginning balance 613 Add: Net Income 104.2 Total 717.2 Less : Common stock dividend 201.8 preferred stock dividend 21.2 Ending Balance 494.2 Balance sheet Asset Current Asset Cash 112.8 Accounts Receivable 178.6 Less : allowance for doubtful debts 12.6 166 Short term Investment 267.8 Inventory 690.2 Prepaid advertising 65.6 Total current asset Land 201.8 Buildings 1166.4 Less: Accumulated depreciation 512.8 653.6 Fixtures 1789.4 Less: Accumulated depreciation 689.6 1099.8 Copyrights 20.8 Goodwill 106.8 Total asset 3385.2 Liabilities Current liabilites Accounts payable 764.8 Income tax payable 75 Salary payable 121.2 Short term Notes Payable 9.4 Advance from customers 21 Interest Payable 14.2 Total current liabilities 1005.6 Long term Liabilties Bonds payable 916.6 Long term Notes payable 99.4 Total Long term Liabilities 1016 Shareholder's equity Common stock 470.4 Preferred stock 265.8 Paid in capital in excess of par 361.4 Retained Earning 494.2 Less : Treasury stock -228.2 Total shareholder's equity 1363.6 Total Liabilites & shareholder's equity 3385.2 Note : Accounts receivable before allowance for doubtful debts is balancing figure as problem put question mark against it.