EBK ACCOUNTING PRINCIPLES
13th Edition
ISBN: 9781119411017
Author: Weygandt
Publisher: WILEY
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How do you figure:
Income from continuing Operation and Discontinued Operation for this problem?
Selected information about income statement accounts for the Reed Company is presented below (the company's fiscal year ends on December 31):
2021
2020
Sales revenue
$
4,400,000
$
3,500,000
Cost of goods sold
2,860,000
2,000,000
Administrative expense
800,000
675,000
Selling expense
360,000
302,000
Interest revenue
150,000
140,000
Interest expense
200,000
200,000
Loss on sale of assets of discontinued component
48,000
—
On July 1, 2021, the company adopted a plan to discontinue a division that qualifies as a component of an entity as defined by GAAP. The assets of the component were sold on September 30, 2021, for $48,000 less than their book value. Results of operations for the component (included in the above account balances) were as follows:
1/1/2021–9/30/2021
2020
Sales revenue
$
400,000
$
500,000
Cost…
Integrative: Pro forma statements Morten Metal Limited has assembled past (2020) financial statements (income statement and balance sheet follows) and financial projections for use in preparing financial plans for the coming year (2021).
Information related to financial projections for the year 2021 follows. (1) Projected sales are $420,000.(2) Cost of goods sold in 2020 includes $72,000 in fixed costs.(3) Operating expense in 2020 includes $17,500 in fixed costs.(4) Interest expense will be $18,000 in 2021.(5) The firm will pay cash dividend amounting to 25% of net profit after taxes.(6) Cash and inventories are expected to double.(7) Marketable securities, long-term debt, and common stock will remain unchanged.(8) Accounts receivable, accounts payable, and other current liabilities will change in direct response to the change in sales.(9) During the year, the firm will purchase a delivery vehicle costing $25,000. The depreciation expense on the new vehicle for 2021 will be…
View Policies Current Attempt in Progress Presented below is financial information related to the 2020 operations of
Ivanhoe Cruises SA. Maintenance and repairs expense, R$96,000 Utilities expense 10,800 Salaries and wages expense
144,000 Advertising expense 3,000 Ticket revenue 359,000 Other comprehensive income 3, 500 Prepare the 2020
income statement for Ivanhoe Cruises SA. Prepare the 2020 comprehensive income statement for Ivanhoe Cruises SA.
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- Given below is AU Chiefs Company’s financial statements. Compute for the financial rations and showthe solutions in a sheet of paper.1. Expenses to sale ratio2. Return on assets3. Return on Equity4. Asset Turnover ratio 2020 2019 Cash 122,500 104,700 Accounts Receivable 90,650 80,550 Inventory 66,200 53,000 Prepaid Expense 85,450 106,000 Total Current Assets 364,800 344,250 Property, Plant and Equipment 925,000 786,350 TOTAL ASSETS 1,654,600 1,475,350 Total Current Liability 381,500 423,350 Long-term Liabilities 359,900 230,600 Mabini, Capital 913,200 821,400 Total Liability and Equity 1,654,600 1,475,350 Sales 1,047,050 1,151,755 Cost of Sales 322,750 355,025 Gross Profit 724,300 796,730 Selling Expenses 353,250 388,575 Administrative Expenses 128,150 140,965 Operating Income 242,900 267,190 Interest Income…arrow_forwardSelected information about income statement accounts for the Reed Company is presented below (the company's fiscal year ends on December 31): 2021 2020 Sales revenue $ 5,350,000 $ 4,450,000 Cost of goods sold 3,050,000 2,190,000 Administrative expense 990,000 865,000 Selling expense 550,000 492,000 Interest revenue 169,000 159,000 Interest expense 238,000 238,000 Loss on sale of assets of discontinued component 124,000 — On July 1, 2021, the company adopted a plan to discontinue a division that qualifies as a component of an entity as defined by GAAP. The assets of the component were sold on September 30, 2021, for $124,000 less than their book value. Results of operations for the component (included in the above account balances) were as follows: 1/1/2021–9/30/2021 2020 Sales revenue $ 590,000 $ 690,000 Cost of goods sold (385,000 ) (434,000 ) Administrative expense (69,000 ) (59,000…arrow_forwardIntegrative: Pro forma statements Morten Metal Limited has assembled past (2020) financial statements (income statement and balance sheet follows) and financial projections for use in preparing financial plans for the coming year (2021) Information related to financial projections for the year 2021 follows. (1) Projected sales are $420,000.(2) Cost of goods sold in 2020 includes $72,000 in fixed costs.(3) Operating expense in 2020 includes $17,500 in fixed costs.(4) Interest expense will be $18,000 in 2021.(5) The firm will pay cash dividend amounting to 25% of net profit after taxes.(6) Cash and inventories are expected to double.(7) Marketable securities, long-term debt, and common stock will remain unchanged.(8) Accounts receivable, accounts payable, and other current liabilities will change in direct response to the change in sales.(9) During the year, the firm will purchase a delivery vehicle costing $25,000. The depreciation expense on the new vehicle for 2021 will be…arrow_forward
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