FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Transcribed Image Text:Exercise no. 6 Balance Sheet and Income Statement Preparation
The following are the balance sheet and income statement data of ABC Company:
Balance Sheet Accounts (December 31)
2019
2020
150,000
850,000
500,000
750,000
500,000
550,000
283,000
1,000,000
1,000,000
500,000
500,000
500,000
Cash
P
Marketable Securities
Accounts Receivable, net
Inventories
Land
Building, net
Machinery and Equipment, net
1,700,000
1,500,000
Goodwill
Deferred charges
Notes Payable, Trade
Accounts Pay
Expenses Payable
400,000
100,000
100,000
610,000
40,000
400,000
90,000
150,000
790,000
Trade
60,000
Long-term Notes due 2027
2,500,000
2,250,000
15% Preference Shares, P100 par
Ordinary Shares, P10 par
500,000
1,500,000
500,000
1,500,000
Retained Earnings
250,000
523,000
2020 Income Statement Accounts
Sales
5,250,000
Sales Returns and Allowances
250,000
Inventory, December 31, 2020
500,000
Inventory, December e1, 2019
750,000
Purchases
2,750,000
400,000
Selling Expenses
Administrative Expenses (including Depreciation of P250,000)
600,000
Interest on Long-term Notes
Income Taxes, 32%
250,000
Additional Information
Dividends paid on preference shares
Dividends paid on ordinary shares
Market price per share on ordinary shares
75,000
162,000
18
Requirements:
1. Prepare comparative balance sheets for 2019 and 2020.
2. Prepare income statement for the year ended December 31, 2020.
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