p-ce Chapter 1 HWw /The following informanon applies to the questions displayed
ID: 2328443 • Letter: P
Question
p-ce Chapter 1 HWw /The following informanon applies to the questions displayed below Ken Young and Kim Shewood orgen zed Reacer Direct as acorporation, each contribuced $47,000 cash to start the business and received 4,000 shares of stock. The store compieted its first year of December 31, 2014 On that date, the following financial tems for the year were determinect cash on hand and in the bank, $42,500, amounts due from customers from se es of books, $27,700, equpment, $46,000, amounts owed to publishers for books purchssed, $8.200, one-year note payable to a local benk for $4050 No dvidends were ceciared or paid to the stockholders during the year operations on References Required Information 1-2, LO 1-3] The tosowsng anformason applies to the questions displayed below Section Break E1 Nt E1-4 Completing a Balance Sheet and Inferring Net Income LCo 0.50 points Ken Young and Kim Shenwood organized $47000 cash to stert the business and received 4.000 shares of stock. The store compieted ts fiest year of operations on December 3t, 2014 On that dlate, the following financial items Or year were determined cash on nand and in the benk. S42.500, ordures ave tom customers from sales of boOKS,$27,700, equipment $46000 amounts owed to publishers Reader Direct as a corporation, each coneributed E1-4 Part 1 Required: .Complete the tollowing balance sheet at December 3 forks purchased. $8.200, one-year note payable to s ioca bank for $4,050 No divicenes were ceciared or paid to the stockhoiders auring the yew Assets Liabilities 42,500 Accounts Payable 4000 Note Payable 6,000 Total Liablites s 35 Cash Accounts Receivable Equipment 9 950 Stockholders Equity DOLLExplanation / Answer
Answers
Term given in question
Amount
Disclosed in Balance Sheet as
Cash on Hand and in Bank
$ 42,500.00
Cash
Amounts due from customers from sale of books
$ 27,700.00
Accounts receivables
Equipments
$ 46,000.00
Equipments
Amount owed to publishers for books purchased
$ 8,200.00
Accounts payable
One year Note payable
$ 4,050.00
Notes payable
Common Stock purchased at the beginning - $47000 each
$ 94,000.00
Common Stock
ASSETS
LIABILITIES
Cash
$ 42,500.00
Accounts payable
$ 8,200.00
Accounts receivables
$ 27,700.00
Notes Payable
$ 4,050.00
Equipment
$ 46,000.00
Total Liabilities
$ 12,250.00
STOCKHOLDER'S EQUITY
Common Stock
$ 94,000.00
Retained earnings
‘not available’
Total Stockholder's Equity
$ 94,000.00
Total Assets
$ 116,200.00
Total Liabilities & Stockholder's Equity
$ 106,250.00
The Total of ‘Total Liabilities & Equity’ falls short by $ 9,950 [116200 – 106250] when compared with total of ‘total assets’.
This $ 9,950 is the amount of Retained earnings (and Net Income because this is the first year of operation as mentioned in the question).
ASSETS
LIABILITIES
Cash
$ 42,500.00
Accounts payable
$ 8,200.00
Accounts receivables
$ 27,700.00
Notes Payable
$ 4,050.00
Equipment
$ 46,000.00
Total Liabilities
$ 12,250.00
STOCKHOLDER'S EQUITY
Common Stock
$ 94,000.00
Retained earnings [calculated above]
$ 9,950.00
Total Stockholder's Equity
$ 103,950.00
Total Assets
$ 116,200.00
Total Liabilities & Stockholder's Equity
$ 116,200.00
Term given in question
Amount
Disclosed in Balance Sheet as
Cash on Hand and in Bank
$ 42,500.00
Cash
Amounts due from customers from sale of books
$ 27,700.00
Accounts receivables
Equipments
$ 46,000.00
Equipments
Amount owed to publishers for books purchased
$ 8,200.00
Accounts payable
One year Note payable
$ 4,050.00
Notes payable
Common Stock purchased at the beginning - $47000 each
$ 94,000.00
Common Stock
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