Unadjusted Trial balance Account Title Adjusted Trial Bala Adjusting Entries $ 9

Question

Unadjusted Trial balance Account Title Adjusted Trial Bala Adjusting Entries $ 95,407.00 7,830.00 $175.00$ 95,232.00 7,830.00 Accounts Receivable Allowance for bad debts Allowance for Sales Returns 200.00 313.00 1,600.00 $20,259.00 750.00 $12,050.00 $2,000.00 4,259.0016,000.00 945.00 $ 12,050.00 S 100.00 S 1,900.00 ntory 195.00 Estimated Returns Inventory Equipment Prepaid Insurance Accumulated Depreciation 850.00 S 340.00 S 1,190.00 S 1,400.00 44,000.00 $39,000.00 450.00 $ 44,000.00 $ 39,000.00 Supp ies 950.00 $ Investment in Tulips Note Receivable Accounts Payable $ 5,100.00 $ 100,000.00 $8,577.00 $ 1,500.00 5,100.00 $ 100,000.00 175.00 remium on Bond Fair value Adjustment Refund Liability Notes Payable ncome Tax payable Interest Payable Common Stock Treasury Stock Retained Earnings $ 1,500.00 S 15,100.00 $ 15,100.00 $2,590.00 594.00 $ 30,200.00 $2,590.00 $594.00 $30,200.00 4,000.00 S 4.000.00 S 48.700.00 1,000.00 $ 48,700.00 $ 1,000.00 id In capital Dividends Sales Revenue Sales Returns S6,000.00 $6,000.00 S 61,446.00 61,446.00 294.00 $36,670.00 $307.00 4,064.00 S 40.734.00 ost Of Goods Sold Sales Discount Forfeited Interest Revenue Interest receivable Interest Expense 112.00 112.00 220.00 220.00 $220.00 594.00 220.00 594.00 $6,900.00 100.00 400.00 340.00 $2,000.00 113.00 950.00 S6,900.00 alaries expense nsurance expense Repair and Maintance Depreciation expense Rent Expense 100.00 400.00 340.00 S 2,000.00 nse 113.00 Office Supplies expense AOCI ncome tax expense Loss on sale Unrealized loss (gain) 950.00 $6,000.00 $6,000.00 $2,590.00 100.00 $1,500.00 $2,590.00 100.00 $1,500.00

Explanation / Answer

Income Statement Sales Revenue 61446 Less: Sales Returns -601 Add: Sales discount forfeited 112 60957 Less: COGS 40734 Gross Margin 20223 Less: Operating expenses: Salaries Expense 6900 Insurance expense 100 Rep.& Maint. 400 Depn. Exp. 340 Rent expense 2000 Bad debt exp. 113 Office supplies expense 950 Loss on sale 100 Unrealised loss 1500 12403 Operating Income 7820 Add:/(Less): Non-operating items: Interest revenue 220 Interest expense -594 -374 Income before tax 7446 Less: Income tax expense -2590 Income after Tax 4856 Cash flow statement(Indirect Method) Operating Activities: Net Income as per Income Statement 4856 Adjustments to non-cash items: Depn. Exp. 340 Bad debt exp. 113 Loss on sale 100 Unrealised loss 1500 2053 Adjusted Net income 6909 Working capital changes: Add: Decrease in Accounts receivables 1729 1370 Add: Decrease in Inventory 7055 Add: Decrease in Office supplies 550 Add: Decrease in prepaid Insurance 100 Less: Increase in Interest receivable -220 Less: Decrease in accounts payable -22300 Add: Increase in refund Liability 61 Add: Increase in Income tax payable 2590 Add: Increase in Interest payable 594 Net change in working capital -9841 Cash used in operating activities -2932 Investing activities Purchase of equipment(Jan-23 entry) -5500 Sale of equipment ( Jan-25) 350 Investment in Tulips -44000 Cash used in Investing activities -49150 Financing activities: Issue of bonds(Jan-2) 108752 Notes payable 15100 Payment of dividends -6000 Purchase of treasury stock -4000 Cash generated in Financing activities 113852 Net cash generated 61770 Add:Beginning cash balance 33000 Ending Cash Balance 94770

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