The following data are available for Arkansas Company. Note that all inventory i

Question

The following data are available for Arkansas Company. Note that all inventory is purchased on account and Accounts Payable relates only to the purchase of inventory.
Dec. 31, 2013 Dec. 31, 2012
Balance Sheet Data (partial)
Accounts receivable $72,000 $65,000
Inventory 54,000 41,000
Prepaid rent ? 8,000
Accounts payable 44,000 52,000
Wages payable 23,000 ?

Income Statement Data
Sales $485,000
Cost of goods sold ?
Wages expense ?
Rent expense 22,000
Other expenses 121,000
Net income ?

Cash Flow Data
+/ - Change in accounts receivable (7,000)
+/ - Change in inventory (13,000)
+/ - Change in accounts payable (8,000)
+/ - Change in prepaid rent ?
+/- Change in wages payable 6,000
Cash from operating activities ?

Other Data
Cash collected from customers ?
Cash paid for inventory ?
Inventory purchased on account 230,000
Cash paid for rent 27,000
Cash paid for wages 81,000
Cash paid for other expenses 121,000
Calculate the missing values in the table above (?). Show all work in the space below or on the back of this page. Hint: Create t-accounts and fill in all data given above. Solve for missing amounts.

Explanation / Answer

Dec. 31, 2013 Dec. 31, 2012
Balance Sheet Data (partial)
Accounts receivable $72,000 $65,000
Inventory 54,000 41,000
Prepaid rent 13000 (8000+27000-22000=x) 8,000
Accounts payable 44,000 52,000
Wages payable 23,000 17000 (23000-6000=x)

Income Statement Data
Sales $485,000
Cost of goods sold 217000 (41000+230000-54000=x)
Wages expense 87000 (17000+x-23000=81000)
Rent expense 22,000
Other expenses 121,000
Net income 38000 (485000-217000-87000-22000-121000=x)

Cash Flow Data
+/ - Change in accounts receivable (7,000)
+/ - Change in inventory (13,000)
+/ - Change in accounts payable (8,000)
+/ - Change in prepaid rent 5000 (13000-8000=x)
+/- Change in wages payable 6,000
Cash from operating activities 51000 (38000+7000+13000-8000-5000+6000=x)

Other Data
Cash collected from customers 478000 (65000+485000-72000=x)
Cash paid for inventory 238000 (52000+230000-44000=x)
Inventory purchased on account 230,000
Cash paid for rent 27,000
Cash paid for wages 81,000
Cash paid for other expenses 121,000
Calculate the missing values in the table above (?). Show all work in the space below or on the back of this page. Create t-accounts and fill in all data given above. Solve for missing amounts.

Related Questions

Navigate

• Browse (All)
• Browse T
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.