Henry Josstick has just started his first accounting course and has prepared the following balance sheet and income statement for Omega Corp. Unfortunately, although the data for the individual items are correct, he is very confused as to whether an item should go in the balance sheet or income statement and whether it is an asset or liability. fill in the blanks by rearranging the items that are wrong: Balance Sheet Payables $ 35 Inventories $50 Less accumulated depreciation 120 Receivables 35 Total current assets ___?____ Total current liabilities __?____ Long-term debt $350 Interest expense $25 Property, plant, and equipment 520 Total liabilities ____?____ Net fixed assets ____?_____ Shareholders Equity $90 Total assets ? Total liabilities and shareholders equity ? Income Statement Net Sales $700 Cost of Goods Sold 580 Selling, general, and administrative expenses 38 EBIT ___?____ Debt due for repayment $25 Cash 15 Taxable income ? Federal plus other taxes $15 Depreciation 12 Net income ? what is the correct total for: a. total liabilities and shareholders equity b. EBIT c. taxable income d. net income
Henry Josstick has just started his first accounting course and has prepared the following
fill in the blanks by rearranging the items that are wrong:
Balance Sheet |
Payables $ 35 Inventories $50 Less accumulated depreciation 120 Receivables 35 Total current assets ___?____ Total current liabilities __?____ Long-term debt $350 Interest expense $25 Property, plant, and equipment 520 Total liabilities ____?____ Net fixed assets ____?_____ Shareholders Equity $90 Total assets ? Total liabilities and shareholders equity ? |
Income Statement |
Net Sales $700 Cost of Goods Sold 580 Selling, general, and administrative expenses 38 EBIT ___?____ Debt due for repayment $25 Cash 15 Taxable income ? Federal plus other taxes $15 Depreciation 12 Net income ? |
what is the correct total for:
a. total liabilities and shareholders equity
b. EBIT
c. taxable income
d. net income
Balance sheet of the financial statements represents all the asset, liabilties and shareholder equity. It helps in determining what the company owns and what it owes.
Income statement of a company shows what are its income through sales and other investents and also its expenses. it helps in determining the overall profit of the company. Based on income statement the financial health of a company can be determined.
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