On December 31, 2019, the balances of the accounts appearing in the ledger of Wyman Company are as follows: Cash $13,500 Accounts Receivable 72,000 Merchandise Inventory, January 1, 2019 257,000 Estimated Returns Inventory 35,000 Office Supplies 3,000 Prepaid Insurance 4,500 Land 150,000 Store Equipment 270,000 Accumulated Depreciation-Store Equipment 55,900 Office Equipment 78,500 Accumulated Depreciation-Office Equipment 16,000 Accounts Payable 27,800 Customer Refunds Payable 50,000 Salaries Payable 3,000 Unearned Rent 8,300 Notes Payable 50,000 Shirley Wyman, Capital 515,600 Shirley Wyman, Drawing 25,000 Sales 3,280,000 Purchases 2,650,000 Purchases Returns and Allowances 93,000 Purchases Discounts 37,000 Freight In 48,000 Sales Salaries Expense 300,000 Advertising Expense 45,000 Delivery Expense 9,000 Depreciation Expense-Store Equipment 6,000 Miscellaneous Selling Expense 12,000 Office Salaries Expense 175,000 Rent Expense 28,000 Insurance Expense 3,000 Office Supplies Expense 2,000 Depreciation Expense-Office Equipment 1,500 Miscellaneous Administrative Expense 3,500 Rent Revenue 7,000 Interest Expense 2,000 Required: 1. Does Wyman Company use a periodic inventory system or perpetual inventory system? Which account listed would not be used under both inventory systems? 2. Prepare a multiple-step income statement for Wyman Company for the year ended December 31, 2019. Be sure to complete the heading of the statement. The merchandise inventory as of December 31, 2019, was $305,000. The adjustment for estimated returns inventory for sales for the year ending December 31, 2019, was $30,000. Refer to the chart of accounts and the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. “Less”, “Add” or colons (:) will automatically appear if required. In the Other revenue and expenses section only, enter amounts that represent other expenses as negative numbers using a minus sign. 3. Prepare the closing entries for Wyman Company as of December 31, 2019. Refer to the Chart of Accounts for exact wording of account titles. 4. What would the net income have been if the perpetual inventory system had been used?
On December 31, 2019, the balances of the accounts appearing in the ledger of Wyman Company are as follows: Cash $13,500 Accounts Receivable 72,000 Merchandise Inventory, January 1, 2019 257,000 Estimated Returns Inventory 35,000 Office Supplies 3,000 Prepaid Insurance 4,500 Land 150,000 Store Equipment 270,000 Accumulated Depreciation-Store Equipment 55,900 Office Equipment 78,500 Accumulated Depreciation-Office Equipment 16,000 Accounts Payable 27,800 Customer Refunds Payable 50,000 Salaries Payable 3,000 Unearned Rent 8,300 Notes Payable 50,000 Shirley Wyman, Capital 515,600 Shirley Wyman, Drawing 25,000 Sales 3,280,000 Purchases 2,650,000 Purchases Returns and Allowances 93,000 Purchases Discounts 37,000 Freight In 48,000 Sales Salaries Expense 300,000 Advertising Expense 45,000 Delivery Expense 9,000 Depreciation Expense-Store Equipment 6,000 Miscellaneous Selling Expense 12,000 Office Salaries Expense 175,000 Rent Expense 28,000 Insurance Expense 3,000 Office Supplies Expense 2,000 Depreciation Expense-Office Equipment 1,500 Miscellaneous Administrative Expense 3,500 Rent Revenue 7,000 Interest Expense 2,000 Required: 1. Does Wyman Company use a periodic inventory system or perpetual inventory system? Which account listed would not be used under both inventory systems? 2. Prepare a multiple-step income statement for Wyman Company for the year ended December 31, 2019. Be sure to complete the heading of the statement. The merchandise inventory as of December 31, 2019, was $305,000. The adjustment for estimated returns inventory for sales for the year ending December 31, 2019, was $30,000. Refer to the chart of accounts and the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. “Less”, “Add” or colons (:) will automatically appear if required. In the Other revenue and expenses section only, enter amounts that represent other expenses as negative numbers using a minus sign. 3. Prepare the closing entries for Wyman Company as of December 31, 2019. Refer to the Chart of Accounts for exact wording of account titles. 4. What would the net income have been if the perpetual inventory system had been used?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
On December 31, 2019, the balances of the accounts appearing in the ledger of Wyman Company are as follows:
Cash | $13,500 |
72,000 | |
Merchandise Inventory, January 1, 2019 | 257,000 |
Estimated Returns Inventory | 35,000 |
Office Supplies | 3,000 |
Prepaid Insurance | 4,500 |
Land | 150,000 |
Store Equipment | 270,000 |
55,900 | |
Office Equipment | 78,500 |
Accumulated Depreciation-Office Equipment | 16,000 |
Accounts Payable | 27,800 |
Customer Refunds Payable | 50,000 |
Salaries Payable | 3,000 |
Unearned Rent | 8,300 |
Notes Payable | 50,000 |
Shirley Wyman, Capital | 515,600 |
Shirley Wyman, Drawing | 25,000 |
Sales | 3,280,000 |
Purchases | 2,650,000 |
Purchases Returns and Allowances | 93,000 |
Purchases Discounts | 37,000 |
Freight In | 48,000 |
Sales Salaries Expense | 300,000 |
Advertising Expense | 45,000 |
Delivery Expense | 9,000 |
Depreciation Expense-Store Equipment | 6,000 |
Miscellaneous Selling Expense | 12,000 |
Office Salaries Expense | 175,000 |
Rent Expense | 28,000 |
Insurance Expense | 3,000 |
Office Supplies Expense | 2,000 |
Depreciation Expense-Office Equipment | 1,500 |
Miscellaneous Administrative Expense | 3,500 |
Rent Revenue | 7,000 |
Interest Expense | 2,000 |
Required: | |
1. | Does Wyman Company use a periodic inventory system or perpetual inventory system? Which account listed would not be used under both inventory systems? |
2. | Prepare a multiple-step income statement for Wyman Company for the year ended December 31, 2019. Be sure to complete the heading of the statement. The merchandise inventory as of December 31, 2019, was $305,000. The adjustment for estimated returns inventory for sales for the year ending December 31, 2019, was $30,000. Refer to the chart of accounts and the list of Labels and Amount Descriptions provided for the exact wording of the answer choices for text entries. “Less”, “Add” or colons (:) will automatically appear if required. In the Other revenue and expenses section only, enter amounts that represent other expenses as negative numbers using a minus sign. |
3. | Prepare the closing entries for Wyman Company as of December 31, 2019. Refer to the Chart of Accounts for exact wording of account titles. |
4. | What would the net income have been if the perpetual inventory system had been used? |
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 4 steps with 10 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education