Financial & Managerial Accounting
14th Edition
ISBN: 9781337515498
Author: WARREN
Publisher: Cengage
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Textbook Question
Chapter 1, Problem 1.25EX
Financial statements
We-Sell Realty, organized as a corporation on August 1, 2018, is owned and operated by Omar Farah, the sole stockholder. How many errors can you find in the following statements for We-Sell Realty, prepared after its first month of operations?
| We-Sell Realty Income Statement August 31, 2018 | ||
| Sales commissions | $140,000 | |
| Expenses: | ||
| Office salaries expense | $87,000 | |
| Rent expense | 18,000 | |
| Automobile expense | 7,500 | |
| Miscellaneous expense | 2,200 | |
| Supplies expense | 1,150 | |
| Total expenses | 115,850 | |
| Net income | $25,000 |
| Omar Farah |
||
| Retained earnings, August 1,2018 | $0 | |
| Dividends | (10,000) | |
| $(10,000) | ||
| Issued additional common stock August 1,2018 | 15,000 | |
| $5,000 | ||
| Net income | 25,000 | |
| Retained earnings, August 31, 2018 | $30,000 |
| Cash | Assets | $8,900 | ||
| Accounts payable | 22,350 | |||
| Total assets | $31,250 | |||
| Liabilities | ||||
| $38,600 | ||||
| Supplies | 4,000 |
| Stockholders’ Equity | ||
| Retained earnings | 30,000 | |
| Total liabilities and stockholders’ equity | $72,600 |
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Students have asked these similar questions
The records of a domestic corporation organized in 2010 show:
2016 2017 2018 2019
Net Sales 3,925,000 4,810,000 5,939,000 6,945,000
Cost of sales 1,950,000 2,710,000 3,465,000 4,180,000
Business expenses including bad
debts written off 1,900,000 2,000,000 2,520,000 2,400,000
Other taxable income 25,000 100,000 26,000 35,000
Recovery of bad debts written off:
In 2016 60,000
In 2017 10,000
The income tax payable for 2016, 2017, 2018, and 2019:
a. ₱ 30,000, ₱78,000, ₱0, ₱73,000
b. ₱ 40,000, ₱68,000, ₱50,000, ₱67,000
c. ₱ 58,500, ₱60,000, ₱18,000, ₱67,000
d. None of the above.
Atlantic Corporation reported the following financial statements:
E (Click the icon to view the financial statements.)
The company has 2,200 shares of common stock outstanding. What is Atlantic's earnings per share? (Round the earnings per share to two decimal places, X.XX.
O A. $1.90
Financial Statements
O B. $3.58
OC. $2.49
O D. 3.19 times
Atlantic Corporation
Comparative Balance Sheet
December 31, 2019 and 2018
2019
2018
Assets
Current Assets:
Cash and Cash Equivalents
2,052 $
1,655
Accounts Receivable
1,951
1,731
Merchandise Inventory
1,342
1,094
1,615
1,817
Prepaid Expenses
Total Current Assets
6,960
6,297
18,240
16,174
Other Assets
2$
25,200 $
22,471
Total Assets
Liabilities
Current Liabilities
24
7.087 $
8,158
4,698
3,844
Long-term Liabilities
Total Liabilities
11,785
12,002
Stockholders' Equity
Common Stock, no par
7,015
4,169
6,400
6,300
Retained Earnings
Click to select your an
Total Stockholders' Equity
13,415
10,469
24
25,200 $
22,471
Clear Al
All parts showing
Total…
Instructions
Accounts, Labels and Amount Descriptions
Income Statements
Instructions
Data taken from the accounting records of Sherri's Designs on December 31 are shown.
Operating expenses
$1,000
Sales revenue
5,000
Inventory, Jan. 1, 2019
1,600
Purchases
1,200
Interest revenue
250
400
Loss on disposal of a discontinued component of the business (pre-tax)
750
Inventory, Dec. 31, 2019
660
Income tax expense
Sherri's Designs has 2,000 shares of common stock outstanding and net income per share for 2019 was S0.63. The income tax rate is 30%.
Required:
a. Prepare a single-step income statement.
b. Prepare a multiple-step income statement.
Chapter 1 Solutions
Financial & Managerial Accounting
Ch. 1 - Name some users of accounting information.Ch. 1 - Prob. 2DQCh. 1 - Prob. 3DQCh. 1 - Prob. 4DQCh. 1 - On July 12, Reliable Repair Service extended an...Ch. 1 - Prob. 6DQCh. 1 - Describe the difference between an account...Ch. 1 - A business had revenues of 679,000 and operating...Ch. 1 - Prob. 9DQCh. 1 - The financial statements are interrelated. What...
Ch. 1 - Prob. 1.1BECh. 1 - Prob. 1.2BECh. 1 - Transactions Interstate Delivery Service is owned...Ch. 1 - Income statement The revenues and expenses of...Ch. 1 - Prob. 1.5BECh. 1 - Balance sheet Using the following data for...Ch. 1 - Statement of cash flows A summary of cash flows...Ch. 1 - Types of businesses The following is a list of...Ch. 1 - Prob. 1.2EXCh. 1 - Prob. 1.3EXCh. 1 - Accounting equation The total assets and total...Ch. 1 - Prob. 1.5EXCh. 1 - Accounting equation Determine the missing amount...Ch. 1 - Prob. 1.7EXCh. 1 - Asset, liability, and stockholders equity items...Ch. 1 - Effect of transactions on accounting equation What...Ch. 1 - Effect of transactions on accounting equation A. A...Ch. 1 - Effect of transactions on stockholders equity...Ch. 1 - Transactions The following selected transactions...Ch. 1 - Nature of transactions Teri West operates her own...Ch. 1 - Net income and dividends The income statement for...Ch. 1 - Net income and stockholders equity for four...Ch. 1 - Balance sheet items From the following list of...Ch. 1 - Income statement items From the following list of...Ch. 1 - Prob. 1.18EXCh. 1 - Income statement Imaging Services was organized on...Ch. 1 - Missing amounts from balance sheet and income...Ch. 1 - Balance sheets, net income Financial information...Ch. 1 - Financial statements Each of the following items...Ch. 1 - Statement of cash flows Indicate whether each of...Ch. 1 - Statement of cash flows A summary of cash flows...Ch. 1 - Financial statements We-Sell Realty, organized as...Ch. 1 - Transactions On September 1 of the current year,...Ch. 1 - Financial statements The amounts of the assets and...Ch. 1 - Financial statements Seth Feye established...Ch. 1 - Transactions; financial statements On August 1,...Ch. 1 - Transactions; financial statements DLite Dry...Ch. 1 - Missing amounts from financial statements The...Ch. 1 - Transactions Amy Austin established an insurance...Ch. 1 - Financial statements The amounts of the assets and...Ch. 1 - Financial statements Jose Loder established Bronco...Ch. 1 - Prob. 1.4BPRCh. 1 - Transactions; financial statements Bevs Dry...Ch. 1 - Missing amount from financial statements The...Ch. 1 - Peyton Smith enjoys listening to all types of...Ch. 1 - Prob. 1ADMCh. 1 - Home Depot: Ratio of liabilities to stockholders'...Ch. 1 - Lowes: Ratio of liabilities to stockholders equity...Ch. 1 - Prob. 4ADMCh. 1 - Ethics in Action Marco Brolo is one of three...Ch. 1 - Prob. 1.3TIF
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