Additional information added in module 3: One client had indicated that they wer

Question

Additional information added in module 3: One client had indicated that they were interested in purchasing $42,500 worth of products. However, the client has not actually committed to the purchase. The bookkeeper already corrected the sales account. However, the bookkeeper may have made a mistake when computing cost of goods sold. She included total production costs for 2012 and did not adjust ending inventory for the $42,500 worth of units left at the end of the year. The amount of ending inventory was determined using a physical count. Additional information for module 4: The company made a secondary offering of stock and raised an additional $150,000. The company had already paid $15,000 in dividends before deciding on the offering. The company now has cash to invest in a piece of raw land on which to build in the future. The investment takes place before year end. The cost of the land is $400,000, the downpayment is $40,000 and a note to the bank covers the rest. Nybrostrand Company 31-Dec-12 Trial Balance (accounts in alphabetical order) Debit Credit Accounts payable 78,000 Accounts receivable 36,500 Cash 16,700 Common stock 10,000 Depreciation expense 24,350 Cost of goods sold 307,000 Equipment (net of depreciation) 415,000 Insurance 1,400 Inventory 34,000 Long-term debt 127,000 Marketing 4,500 Paid-in capital 50,000 Property taxes 16,900 Rent 28,000 Retained earnings ? Revenues 586,000 Salaries 78,500 Utilities 6,700 Total 969,550 851,000 Prepare a balance sheet for the company in good format. Update the balance sheet for the changes to income in module 3 and also consider the effect of paying the dividend. You do not need to include the income statement.

Explanation / Answer

followthis ncome statement particulars amount amount revenues 456,000 -Adjusted sales 34 500 421500 Net sales revenue Cost of good sold 254,000 Less- adjusted cost of goods sold 19 217 234 783 -sold 234 783 Gross profit $186 717 salaries 67500 depreciation 24350 insurance 1400 Marketing expenses 4500 property 8900 rent 18 000 utilities 6700 expenses 131 350 Net income 55 367 St. Of retained earning begining Net income 55367 Less dividend Eding 55367 Calculation of gross profit sales 456 000 less 254 000 profit 202000 profit 44.30%

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.