The Artisan Wines is a retail store selling vintage wines. On December 31, 2019,
ID: 2431981 • Letter: T
Question
The Artisan Wines is a retail store selling vintage wines. On December 31, 2019, the firm's general ledger contained the accounts and balances below. All account balances are normal. Artisan Wines Worksheet Year Ended December 31, 2019 Trial Balance Debit Adjustments Adjusted Trial Balance Income Statement Balance Sheet Account Name Credit Debit Credit Debit Credit Debit redit Credit $28,286.00 498.00 760.00 5 28,286.8 Accounts Receivable Prepaid Advertising Supplies Merchandise Inventory Store Equipment Accumulated Depreciation-Store Equipment Office Equipment Accumulated Depreciation-Office Equipment Notes Payable, due 2020 Accounts Payable Wages Payable Social Security Tax Payable Medicare Tax Payable Unearned Seminar Fees Interest Payable vincent Arroyo, Capital Vincent Arroyo, Drawing Income 380.00 195.90 1,140.00 760.80 14,900.e0 24, 5ee.ee 11,900.00 14,980.8 11,900.80 24, 500.80 11,900.00 24, 500.8e 2,900.00 3,100.0e 6,000.00 6,000.00 4,980,88 4,900.8e 4,989.8e 1,490·00 19,50e.ee 2,488.00 2,480.00 5,700.00 3,8e8.00 1,900.0e 1,980.06e 33,630.00 33,630.00 33,630.0e 14,81 14,918.8e 14,980.00 11,980.00 14,900.0 11,900.00 14,930.00 11,900.00 152,979.ee 152,979.ee Sales Discounts Seminar Fee Income Purchases Purchases Returns and Allowances 152,97.80 3,800.0e 990.80 190.00 190.00 3,800.0 9e,500.83 9e,500.80 90,500.00 13,180.83 23,900.e0 3,224.ea 13,180.80 24,300.e0 3,254.68 3,100.0e Rent Expense Wages Expense Payroll Taxes Expense Depreciation Expense-Store Equipment Depreciation Expense-Office Equipment Advertising Expense Supplies Expense Interest Expense Totals 13,180.80 24,300.80 3,254 3,100.00 3,100.80 380 380.00 195 , 09 195.80 140.00 237 $219,785.00 $219,785.00 $35,793.10 $35,793.10 $236, 303.10 $236,303.10 $151,36210 $169,660.80 $84,941.80 $66,643.1e $169,66.00 $169,666.80 $84,941.00 $84,941.0 1. Prepare a classified income statement for the year ended December 31, 2019. The company does not classify its operating expenses as selling expenses and general and administrative expenses. 2. Prepare a statement of owner's equity for the year ended December 31, 2019. No additional investments were made during the year 3. Prepare a classified balance sheet as of December 31, 2019. Analyze: What is the inventory turnover for Artisan Wines?Explanation / Answer
ARTISAN WINES
INCOME STATEMENT
For the year ended december 31 2019
$
$
$
Operating Revenue
Sales
152970
Less: Sales discount
-190
Net Sales
152780
Cost of goods sold
Merchandise inventory opening
14900
Purchases
90500
Freight in
215
Delivered cost of purchases
90715
Less: purchase returns and allowances
-990
Net delivered cost of purchases
89725
Goods available for sale
104625
Less: Merchandise inventory closing
-11900
Cost of goods sold
92725
Gross profit on sales
60055
Operating expenses
Rent expense
13100
wages expense
24300
Payroll taxes expense
3254.6
Depreciaiton expense - store equipment
3100
Depreciation expense - office equipment
990
Advertising expense
380
Supplies expense
195
Total operating expense
45319.6
Income from operations
14735.4
Other incom
Seminar fee income
3800
3800
Other expenses
Interest expense
237.5
237.5
Net non operating income
18297.9
ARTISAN WINES
INCOME STATEMENT
For the year ended december 31 2019
Vincent Arroyo capital,janury 1
33630
Net income for the year
18297.9
Less: withdrawls for the year
-14010
Increase in capital
4287.9
Vincent Arroyo capital,December 31
37917.9
ARTISAN WINES
Balance sheet
For the year ended december 31 2019
Assets
Current Assets
Cash
28286
Accounts receivable
490
Merchandise inventory
11900
Prepaid expense
760
Supplies
95
Total current assets
41531
Plant and equipment
Store equipment
24500
Less: Accumulated depreciation
-6000
18500
Office equipment
4900
Less: Accumulated depreciation
-2480
2420
Total plant and equipment
20920
Total assets
62451
Liabilities and owner equity
current liabilities
social security tax Payable
24.8
Medicare tax payable
5.8
Unearned seminar fees
1900
Notes Payable
19500
Accounts Payable
2605
Wages Payable
400
Interest Payable
97.5
Total current liabilities
24533.1
Total liabilities
Vincent Arroyo capital,janury 1
33630
Net income for the year
18297.9
Less: withdrawals for the year
-14010
Increase in capital
4287.9
Vincent Arroyo capital, December 31
37917.9
62451
Inventory turnover: 6.92 times
Cost of good sold
92725
Average inventory
(14900+11900)/2
13400
Inventory turnover ratio
6.919776
ARTISAN WINES
INCOME STATEMENT
For the year ended december 31 2019
$
$
$
Operating Revenue
Sales
152970
Less: Sales discount
-190
Net Sales
152780
Cost of goods sold
Merchandise inventory opening
14900
Purchases
90500
Freight in
215
Delivered cost of purchases
90715
Less: purchase returns and allowances
-990
Net delivered cost of purchases
89725
Goods available for sale
104625
Less: Merchandise inventory closing
-11900
Cost of goods sold
92725
Gross profit on sales
60055
Operating expenses
Rent expense
13100
wages expense
24300
Payroll taxes expense
3254.6
Depreciaiton expense - store equipment
3100
Depreciation expense - office equipment
990
Advertising expense
380
Supplies expense
195
Total operating expense
45319.6
Income from operations
14735.4
Other incom
Seminar fee income
3800
3800
Other expenses
Interest expense
237.5
237.5
Net non operating income
18297.9
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