Issa Manufacturing Company was started on January 1, 2014, when it acquired $80,

Question

Issa Manufacturing Company was started on January 1, 2014, when it acquired $80,000 cash by issuing common stock. Issa immediately purchased office furniture and manufacturing equipment costing $9,500 and $27,100, respectively. The office furniture had a seven-year useful life and a zero salvage value. The manufacturing equipment had a $4,000 salvage value and an expected useful life of three years. The company paid $11,400 for salaries of administrative personnel and $15,400 for wages to production personnel. Finally, the company paid $8,880 for raw materials that were used to make inventory. All inventory was started and completed during the year. Issa completed production on 4,100 units of product and sold 3,150 units at a price of $15 each in 2014. (Assume that all transactions are cash transactions.)

Determine the total product cost and the average cost per unit of the inventory produced in 2014. (Round "Average cost per unit" answer to 2 decimal places.)

Determine the amount of cost of goods sold that would appear on the 2014 income statement. (Do not round intermediate calculations. Round your answer to the nearest dollar amount.)

Determine the amount of the ending inventory balance that would appear on the December 31, 2014, balance sheet. (Do not round intermediate calculations. Round your answer to the nearest dollar amount.)

Determine the amount of net income that would appear on the 2014 income statement. (Round your answer to the nearest dollar amount.)

Determine the amount of retained earnings that would appear on the December 31, 2014, balance sheet. (Round your answer to the nearest dollar amount.)

Determine the amount of total assets that would appear on the December 31, 2014, balance sheet.(Round your answer to the nearest dollar amount.)

Determine the amount of net cash flow from operating activities that would appear on the December 31, 2014 statement of cash flows. (List cash outflow as negative amount.)

Determine the amount of net cash flow from investing activities that would appear on the December 31, 2014 statement of cash flows. (List cash outflow as negative amount.)

Issa Manufacturing Company was started on January 1, 2014, when it acquired $80,000 cash by issuing common stock. Issa immediately purchased office furniture and manufacturing equipment costing $9,500 and $27,100, respectively. The office furniture had a seven-year useful life and a zero salvage value. The manufacturing equipment had a $4,000 salvage value and an expected useful life of three years. The company paid $11,400 for salaries of administrative personnel and $15,400 for wages to production personnel. Finally, the company paid $8,880 for raw materials that were used to make inventory. All inventory was started and completed during the year. Issa completed production on 4,100 units of product and sold 3,150 units at a price of $15 each in 2014. (Assume that all transactions are cash transactions.)

Explanation / Answer

Ans a Total Product Cost Raw material $8,800 Wages to production Personnel 15400 Depreciation on equipment (27100-4000)/3 7700 Total Product Cost $31,900 No. of units produced 4100 Average cost per unit $7.78 Ans B cost per unit 7.78 COGS 3150*7.78 $24,509 $ Ans Ans c Ending Inventory (4100 total units -3150 units sold)*7.78 7391 $ Ans Ans D Income statement Sales 3150*15 47250 Less: COGS $24,509 Gross Margin $22,741 Selling & Administrative expenses Salaries of Administrative Personnel 11400 Depreciation on furniture 9500/7 1357 Net Income 10043 ans e Retained earning balance $10,043

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