The following information was drawn from the accounting records of Wyckoff Compa
ID: 2337020 • Letter: T
Question
The following information was drawn from the accounting records of Wyckoff Company as of December 31, 2018, before the temporary accounts had been closed. The Cash balance was $3,080, and Notes Payable amounted to $22,350. The company had revenues of S3,950and expenses of $2,280. The company's Land account had a $5,500 balance. Dividends amounted to $900. The balance of the Common Stock account was $1,100 Required a. Identify which accounts would be classified as permanent and which accounts would be classified as temporary b. Assuming that Wyckoff's beginning balance (as of January 1, 2018) in the Retained Earnings account was $3,700, determine its balance after the temporary accounts were closed at the end of 2018 C. What amount of net income would Wyckoff Company report on its 2018 income statement? Complete this question by entering your answers in the tabs below Req A Req B and C Identify which accounts would be classified as permanent and which accounts would be classified as temporary. Account Classification Cash Notes Payable Revenues Expenses Dividends Common Stock Retained EarningsExplanation / Answer
Solution a:
Solution b:
Net income for 2018 = Revenue - Expenses = $3,950 - $2,280 = 1,670
Ending balance of retained earnings = Begining retained earnings + Net Income - Dividends
= $3,700 + $1,670 - $900 = $4,470
Solution c:
Net Income to be reported in 2018 income statement = Revenue - Expenses = $3,950 - $2,280 = 1,670
Cash Permanent Notes Payable Permanent Revenues Temporary Expenses Temporary Land Permanent Dividends Temporary Common Stock Permanent Retained Earnings PermanentRelated Questions
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