REGUIRED : USING THE INCOME STATEMENT AND ALL INFORMATION BELOW PLEASE COMPUTE T
ID: 2574160 • Letter: R
Question
REGUIRED:
USING THE INCOME STATEMENT AND ALL INFORMATION BELOW PLEASE COMPUTE TRIAL BALANCE WITH ADJUSTING JOURNAL ENTRIES: (Begining Balance (Dr Cr), Adjusting entries(Dr Cr), Ending Balance(Dr Cr)
FPI Income Statement:
Notes:
FPI's purchases during 2015 were $115,000. It values its inventory based on cost using the FIFO inventory cost flow method. Assume the rules of §263A do not apply to FPI.
Of the $5,000 interest income, $2,000 was from a West Jordan city bond used to fund public activities (issued in 2007) and $3,000 was from a money market account.
FPI's dividend income comes from publicly traded stocks that FPI has owned for two years.
FPI's compensation is as follows:
Kate $120,000
James $80,000
Other $400,000.
FPI wrote off $6,000 in accounts receivable as uncollectible during the year.
FPI's regular tax depreciation was $17,000. AMT depreciation was $13,000.
FPI distributed $60,000 to its shareholders.
FPI is not required to compute the amount in its accumulated adjustments account.
The following are FPI's book balance sheets as of January 1, 2015, and December 31, 2015.
FPI Income Statement For year ending December 31, 2015 Revenue from sales Sales returns and allowances Cost of goods sold Gross profit from operations $980,000 (10,000) (110,000) $ 860,000 Other income: Dividend income Interest income Gross income $ 15,000 5,000 $ 880,000 Expenses Compensation Depreciation Bad debt expense Meals and entertainment Maintenance Business interest Property taxes Charitable contributions Other taxes Rent Advertising Professional services Employee benefits Supplies Other expenses Total expenses Net income $(600,000) (10,000) (14,000) (2,000) (8,000) (1,000) (7000) (10,000) (30,000) (28,000) 14,000) (11,000) (12,000) (3,000) (21,000) 771,000) $109,000Explanation / Answer
EXTENDED TRIAL BALANCE
ADJUSTMENTS
INCOME STATEMENT
CLOSING BALANCES
OPENING BALANCES
DR
CR
DR
CR
DEBIT
CR
DEBIT
CREDIT
DEBIT
CREDIT
CASH
90000
954000
1000
20000
120000+60000+
740000+
143000
INVESTMENTS
82000
82000
ACC REC
300000
6000
980000
964000
310000
ALLOWANCE FOR B/D
60000
8000
68000
INVENTORY
50000
BONDS
38000
38000
OTHER ASSETS
20000
1000
21000
FIXED ASSETS
100000
100000
ACC DEP
20000
10000
30000
ACC PAY
60000
120000
55000
OTHER CL
5000
8000
OTHER LIAB
10000
14000
CAPITAL STOCK
200000
200000
RETAINED EARN
320000
60000
260000
PROFIT FOR YEAR
109000
109000
SALES
980000
980000
SALES RETURNS
10000
10000
COS OP INV +PURCHASES
45000
115000
110000
INVENTORY CLOSING
50000
50000
BAD DEBTS
8000
14000
INTEREST
1000
OTHER EXPENSES
21000
RENT
28000
DIVIDEND INCOME
15000
15000
INTEREST INCOME
5000
5000
COMPENSATION
600000
600000
DEPRECIATION
10000
10000
MEALS & ENTERTAINMENT
2000
2000
MAINTENANCE
8000
8000
PROPERTY TAXES
7000
7000
CHARITY
10000
10000
OTHER TAXES
30000
30000
ADVRTISING
14000
14000
PROF SERV
11000
11000
EMPLOYEE BENEFITS
12000
12000
SUPPLIES
3000
3000
595000
595000
1000000
1000000
646000
646000
EXTENDED TRIAL BALANCE
ADJUSTMENTS
INCOME STATEMENT
CLOSING BALANCES
OPENING BALANCES
DR
CR
DR
CR
DEBIT
CR
DEBIT
CREDIT
DEBIT
CREDIT
CASH
90000
954000
1000
20000
120000+60000+
740000+
143000
INVESTMENTS
82000
82000
ACC REC
300000
6000
980000
964000
310000
ALLOWANCE FOR B/D
60000
8000
68000
INVENTORY
50000
BONDS
38000
38000
OTHER ASSETS
20000
1000
21000
FIXED ASSETS
100000
100000
ACC DEP
20000
10000
30000
ACC PAY
60000
120000
55000
OTHER CL
5000
8000
OTHER LIAB
10000
14000
CAPITAL STOCK
200000
200000
RETAINED EARN
320000
60000
260000
PROFIT FOR YEAR
109000
109000
SALES
980000
980000
SALES RETURNS
10000
10000
COS OP INV +PURCHASES
45000
115000
110000
INVENTORY CLOSING
50000
50000
BAD DEBTS
8000
14000
INTEREST
1000
OTHER EXPENSES
21000
RENT
28000
DIVIDEND INCOME
15000
15000
INTEREST INCOME
5000
5000
COMPENSATION
600000
600000
DEPRECIATION
10000
10000
MEALS & ENTERTAINMENT
2000
2000
MAINTENANCE
8000
8000
PROPERTY TAXES
7000
7000
CHARITY
10000
10000
OTHER TAXES
30000
30000
ADVRTISING
14000
14000
PROF SERV
11000
11000
EMPLOYEE BENEFITS
12000
12000
SUPPLIES
3000
3000
595000
595000
1000000
1000000
646000
646000
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