The following items are taken from the financial statements ofMaxon Company for

Question

The following items are taken from the financial statements ofMaxon Company for 12/31/2009: accontspayable                                                       18,500 accountsreceivable                                                   4,000 accumulationdepreciation                                         4,800 bondspayable                                                          18,000 cash2                                                                        4.,000       commonstocks                                                         25,000 cost of goodssold                                                      13,000 depreciationexpense                                                     4,800 dividends                                                                     5,300 equipment                                                                     48,000 interestexpense                                                            2,500 patents                                                                        7,500 retained earnings january1                                          16,000 salariesexpense                                                           5,200 salesrevenue                                                               36,500 supplies                                                                     4,500 prepare an income statment and a classified balance sheet formaxon company. The following items are taken from the financial statements ofMaxon Company for 12/31/2009: accontspayable                                                       18,500 accountsreceivable                                                   4,000 accumulationdepreciation                                         4,800 bondspayable                                                          18,000 cash2                                                                        4.,000       commonstocks                                                         25,000 cost of goodssold                                                      13,000 depreciationexpense                                                     4,800 dividends                                                                     5,300 equipment                                                                     48,000 interestexpense                                                            2,500 patents                                                                        7,500 retained earnings january1                                          16,000 salariesexpense                                                           5,200 salesrevenue                                                               36,500 supplies                                                                     4,500 prepare an income statment and a classified balance sheet formaxon company.

Explanation / Answer

                   Maxon Company                     Income statement                   For the year ended, Dec 2009 SalesRevenue                     $ 36,500 -COGS                                 13,000 Gross profit          23,500 Expenses      Salaries exp.    5,200 Dep.Expense 4,800 Interest exp.    2,500       12,500 NetIncome                       $ 11,000 -------------------------------------------------------------------                              Maxon Company                               Retained earnings statement                                For the year ended, Dec 2009 Retained earnings, Beginingbalance             $ 16,000 Add NetIncome                                            11,000                                                                      27,000 Deduct Dividends          5,300 Retained earnings ending balance       21,700 -------------------------------------------------------------------                                Maxon Company                                 Balance sheet                                 Dec 31, 2009 Assets C.assets Cash                              $ 24,000 A/R                                    4,000 Supplies                              4,500 TotalC.assets                                        32,500 Property, Plant & equip Equipment                       48,000 Acc.Depreciation              4,800            43,200 Intangibles Patent          7,500 Totalassets                                         83,200 Liabilities & Stock holders equity C.liabilities A/P                                                       18,500 L.term liability B/P                                                       18,000 C.stock       25,000 Retained earnings        21,700 Total Liabilities & Stock holders equity $83,200

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