ACCT 1201 Chapter Notes - Chapter 5: Retained Earnings, Financial Statement, Deferral
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13 Feb 2014
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4)
Financial statements of Rukavina Corporation follow: |
Rukavina Corporation Comparative Balance Sheet | ||
Ending Balance | Beginning Balance | |
Assets: | ||
Cash and cash equivalents | $34 | $31 |
Accounts receivable | 86 | 82 |
Inventory | 45 | 41 |
Property, plant and equipment | 678 | 580 |
Less: accumulated depreciation | 350 | 300 |
Total assets | $493 | $434 |
Liabilities and stockholders' equity: | ||
Accounts payable | $67 | $72 |
Bonds payable | 145 | 210 |
Common stock | 92 | 82 |
Retained earnings | 189 | 70 |
Total liabilities and stockholders' equity | $493 | $434 |
Income Statement | |
Sales | $755 |
Cost of goods sold | 383 |
Gross margin | 372 |
Selling and administrative expenses | 127 |
Net operating income | 245 |
Income taxes | 87 |
Net income | $158 |
Cash dividends were $39. The company did not dispose of any property, plant, and equipment. It did not issue any bonds payable or repurchase any of its own common stock. The following questions pertain to the company's statement of cash flows. |
The net cash provided by (used in) investing activities for the year was: |
$(39)
$(65)
$(98)
$10
5) Alcoser Corporation's most recent balance sheet appears below:
Comparative Balance Sheet | ||
Ending Balance | Beginning Balance | |
Assets: | ||
Cash and cash equivalents | $34 | $29 |
Accounts receivable | 32 | 36 |
Inventory | 53 | 66 |
Property, plant and equipment | 554 | 480 |
Less accumulated depreciation | 208 | 206 |
Total assets | $465 | $405 |
Liabilities and stockholders’ equity: | ||
Accounts payable | $41 | $50 |
Accrued liabilities | 17 | 16 |
Income taxes payable | 28 | 30 |
Bonds payable | 217 | 200 |
Common stock | 75 | 70 |
Retained earnings | 87 | 39 |
Total liabilities and equity | $465 | $405 |
Net income for the year was $60. Cash dividends were $12. The company did not dispose of any property, plant, and equipment. It did not issue any bonds payable or repurchase any of its own common stock. The following questions pertain to the company's statement of cash flows.
The net cash provided by (used in) investing activities for the year was:
$74
($74)
($72)
$72
Presentedbelow are the 2011 income statement and comparative balance | |||||||
sheet for Siegfried & Royce. | |||||||
Siegfried & Royce | |||||||
Income Statement | |||||||
For the Year Ended December 31, 2011 | |||||||
($ inthousands) | |||||||
Sales revenue | $12,500 | ||||||
Operating expenses: | |||||||
Cost of goods sold | 7300 | ||||||
Depreciation | 400 | ||||||
Rent | 250 | ||||||
Administrative and other | 2200 | ||||||
Total operating expenses | 10,150 | ||||||
Income before income taxes | 2,350 | ||||||
Income tax expense | 940 | ||||||
Net income | $1,410 | ||||||
Balance Sheet information ($ in thousands) | Dec. 31, 2011 | Dec. 31, 2010 | |||||
Assets: | |||||||
Cash | $3,280 | $1,300 | |||||
Accounts receivable | 1,250 | 980 | |||||
Inventory | 980 | 900 | |||||
Prepaid rent | 150 | 100 | |||||
Plant & equipment | 3,000 | 2,600 | |||||
Less: Accumulated depreciation | -1,200 | -800 | |||||
Totalassets | $7,460 | $5,080 | |||||
Liabilities and shareholders’ equity: | |||||||
Accounts payable | $500 | $580 | |||||
Payables for administrative and other expenses | 650 | 700 | |||||
Income taxes payable | 450 | 350 | |||||
Note payable (due 12/31/2012) | 2,500 | 2,000 | |||||
Common stock | 1,500 | 1,000 | |||||
Retained earnings | 1,860 | 450 | |||||
Totalliabilities and shareholders’ equity | $7,460 | $5,080 | |||||
Required: Prepare a Statement of Cash Flows using the directmethod for operating activities. Assume that all purchases andsales of inventory are on account, and that there are noanticipated bad debts for accounts receivable.
TIP: Use T accounts for the pertinent items toisolate the information for the statement