The following transactions pertain to year 1, the first-year operations of Rundle Company. All inventory was started and completed during year 1. Assume that all transactions are cash transactions. Acquired $4,300 cash by issuing common stock. Paid $700 for materials used to produce inventory. Paid $1,820 to production workers. Paid $948 rental fee for production equipment. Paid $120 to administrative employees. Paid $112 rental fee for administrative office equipment. Produced 340 units of inventory of which 220 units were sold at a price of $12 each. Required Prepare an income statement and a balance sheet in accordance with GAAP.

The following accounting events affected Rundle Manufacturing Company during its first three years of operation. Assume that all transactions are cash transactions. Transactions for Year 1 1. Started manufacturing company by Issuing common stock for $3,000. 2. Purchased $1,280 of direct raw materials. 3. Used $790 of direct raw materials to produce Inventory. 4. Paid $360 of direct labor wages to employees to make Inventory. 5. Applied $290 of manufacturing overhead cost to Work In Process Inventory. 6. Finished work on Inventory that cost $960. 7. Sold goods that cost $610 for $1,180. 8. Pald $310 for selling and administrative expenses. 9. Actual manufacturing overhead cost amounted to $213 for the year. Transactions for Year 2 1. Acquired additional $1,600 of cash from common stock. 2. Purchased $1,210 of direct raw materials. 3. Used $1,260 of direct raw materials to produce Inventory. 4. Pald $600 of direct labor wages to employees to make Inventory. 5. Applied $300 of…

Vernon Manufacturing started in Year 2 with the following account balances. Cash Common stock Retained earnings $6,000 5,151 5,400 1,400 890 2,261 Raw materials inventory Work in process inventory Finished goods inventory (380 units @ $5.95 each) Transactions during Year 2 1. Purchased $2,890 of raw materials with cash. 2. Transferred $3,770 of raw materials to the production department. 3. Incurred and paid cash for 240 hours of direct labor @ $15.30 per hour. 4. Applied overhead costs to the Work in Process Inventory account. The predetermined overhead rate is $16.00 per direct labor hour. 5. Incurred actual overhead costs of $4,000 cash. 6. Completed work on 1,250 units for $6.00 per unit. 7. Paid $1,160 in selling and administrative expenses in cash. 8. Sold 1,250 units for $10,600 cash revenue (assume FIFO cost flow). 9. Vernon charges overapplied or underapplied overhead directly to Cost of Goods Sold. Required a. Record the preceding events in a horizontal statements model. The…

Halpern Company's controller prepared the following income statement and balance sheet at the end of the first year of the company's existence: Income Statement Sales revenue $ 40,000 Cost of sales (20,000) Operating expenses (8,000) Net income $ 12,000 Balance Sheet Cash $ 33,000   Accounts payable $ 5,000 Inventory 24,000   Notes payable 40,000 R&D costs 30,000   Common stock 50,000 Property, plant, and equipment (net) 20,000   Retained earnings 12,000   $107,000     $107,000 Investigation shows that R&D costs include, among others, $8,000 of operating costs because "the company is not yet operating at capacity." In addition, R&D costs include $5,000 of materials that were wasted during early production because "our employees made some unnecessary mistakes." Required: Prepare the income statement according to GAAP. HALPERN COMPANYIncome StatementYear 1   $- Select -   - Select -   $- Select -   - Select -   -…

York Company engaged in the following transactions for Year 1. The beginning cash balance was $86,000 and the ending cash balance was $59,100. 1. Sales on account were $548,000. The beginning receivables balance was $128,000 and the ending balance was $90,000. 2. Salaries expense for the period was $232,000. The beginning salaries payable balance was $16,000 and the ending balance was $8,000. 3. Other operating expenses for the period were $236,000. The beginning other operating expenses payable balance was $16,000 and the ending balance was $10,000. 4. Recorded $30,000 of depreciation expense. The beginning and ending balances in the Accumulated Depreciation account were $12,000 and $42,000, respectively. 5. The Equipment account had beginning and ending balances of $44,000 and $56,000, respectively. There were no sales of equipment during the period. 6. The beginning and ending balances in the Notes Payable account were $36,000 and $44,000, respectively. There were no payoffs of…

Walton Manufacturing started in Year 2 with the following account balances.     Cash $ 5,800   Common stock   4,630   Retained earnings   5,800   Raw materials inventory   1,300   Work in process inventory   810   Finished goods inventory (420 units @ $6.00 each)   2,520        Transactions during Year 2 Purchased $2,950 of raw materials with cash. Transferred $3,780 of raw materials to the production department. Incurred and paid cash for 200 hours of direct labor @ $15.50 per hour. Applied overhead costs to the Work in Process Inventory account. The predetermined overhead rate is $16.40 per direct labor hour. Incurred actual overhead costs of $3,400 cash. Completed work on 1,300 units for $5.50 per unit. Paid $1,130 in selling and administrative expenses in cash. Sold 1,300 units for $9,800 cash revenue (assume FIFO cost flow). Walton charges overapplied or underapplied overhead directly to Cost of Goods Sold.   Required Record the preceding…

1. Purchased $75,180 in materials on account. Check my work 2. Issued $2,100 in supplies from the materials inventory to the production department. 3. Paid for the materials purchased in transaction (1) 4. Issued $35,700 in direct materials to the production department. 5. Incurred wage costs of $58,800, which were debited to Payroll, a temporary account. Of this amount, $18,900 was withheld for payroll taxes and credited to Payroll Taxes Payable. The remaining $39,900 was paid in cash to the employees. See transactions (6) and (7) for additional information about Payroll. 5. Recognized $29,400 in fringe benefit costs, incurred as a result of the wages paid in (5). This $29,400 was debited to Payroll and credited to Fringe Benefits Payable 7. Analyzed the Payroll account and determined that 60 percent represented direct labor; 30 percent, indirect manufacturing labor, and 10 percent, administrative and marketing costs. 8. Paid for utilities, power, equipment maintenance, and other…

Sanchez Company engaged in the following transactions during Year 1: 1) Started the business by issuing $45,200 of common stock for cash. 2) The company paid cash to purchase $28,000 of Inventory. 3) The company sold inventory that cost $17,600 for $34,600 cash. 4) Operating expenses incurred and paid during the year, $15,600. Sanchez Company engaged in the following transactions during Year 2: 1) The company paid cash to purchase $38,400 of inventory. 2) The company sold inventory that cost $34,400 for $61,000 cash. 3) Operating expenses incurred and paid during the year, $19,600. Note: Sanchez uses the perpetual inventory system. What is the amount of retained earnings that will be shown on the balance sheet at December 31, Year 2? Multiple Choice $7,000

During Year 1, Hardy Merchandising Company purchased $21,000 of inventory on account. Hardy sold inventory on account that cost $15,800 for $23,600. Cash payments on accounts payable were $13,100. There was $21,000 cash collected from accounts receivable. Hardy also paid $4,100 cash for operating expenses. Assume that Hardy started the accounting period with $18,500 in both cash and common stock. Required a. Record the events in a horizontal statement model. In the Cash Flow column, use OA to designate operating activity, IA for investment activity, FA for financing activity, or NC for net change in cash. If the element is not affected by the event, leave the cell blank. b. What is the balance of accounts receivable at the end of Year 1? c. What is the balance of accounts payable at the end of Year 1? d. What are the amounts of gross margin and net income for Year 1? e. Determine the amount of net cash flow from operating activities. Complete this question by entering your answers in…

During Year 1, Hardy Merchandising Company purchased $16,000 of inventory on account. Hardy sold inventory on account that cost $12,000 for $18,000. Cash payments on accounts payable were $10,000. There was $16,000 cash collected from accounts receivable. Hardy also paid $3,600 cash for operating expenses. Assume that Hardy started the accounting period with $24,000 in both cash and common stock.     Record the events in a horizontal statement model. In the Cash Flow column, use OA to designate operating activity, IA for investment activity, FA for financing activity, or NC for net change in cash. If the element is not affected by the event, leave the cell blank. What is the balance of accounts receivable at the end of Year 1? What is the balance of accounts payable at the end of Year 1?