The ledger of Articulation Systems Inc. showed the following balances after adju

Question

The ledger of Articulation Systems Inc. showed the following balances after adjustment, but before closing, on December 31, 2018, the end of the current year (all accounts have normal balances):

Insurance expense 11000
Sales returns and allowances 22500
Bad debt expense 6000
Accounts payable 81000
Accounts receivable 108590
Allowance for doubtful accounts (also known as the allowance for bad debt) 8500
Accumulated depreciation – equipment 27740
Depreciation expense 1200
Interest revenue 2100
Cash 80470
Common stock (10,000 shares outstanding) 100000
Cost of goods sold 598550
Dividends declared (not yet paid) 18000
Equipment 139450
General expenses 113250
Dividends payable 2000
Sales discounts 23000
Interest expense 5600
Paid-in capital in excess of par 110000
Marketable Securities 12000
Merchandise inventory 154250
Prepaid insurance 11225
Salaries expense 42100
Retained earnings ?
Dividend Revenue 10000
Salaries Payable 12350
Sales 974500
Selling expenses 129210
The president of Articulation Systems Inc., has asked you to develop a flexible financial statement package, using Excel that includes:
• a data entry sheet
• an adjusted trial balance,
• a single-step income statement,
• a multi-step income statement,
• a statement of retained earnings,
• a classified balance sheet, and
• a post-close trial balance

Additional Instructions: You can ignore taxes in this project. Each statement must be on one sheet in the file and this file should allow the financial statements to be prepared quickly by entering account balances in the appropriate cells on the first sheet of the file (book) – data entry sheet. Include percentages in the Multi-step Income Statement (vertical analysis) i.e. gross profit percentage, % of selling expenses to sales, etc

Explanation / Answer

Trial Balance and Calculation of Retained Earning Particulars Debit   Credit Insurance Expense       11,000 Sales Return and Allowance       22,500 Bad Debts Expense         6,000 Account Payable       81,000 Accounts Receivables    1,08,590 Allowance for Bad debts         8,500 Accumulated Depreciation       27,740 Depreciation Expense         1,200 Interest Revenue         2,100 cash       80,470 Common Stock - Shares    1,00,000 COGS    5,98,550 Dividend Declared Not yet paid       18,000 Equipment    1,39,450 General Expense    1,13,250 Dividend payable         2,000 Sales discounts       23,000 Interest Expense         5,600 paid in capital in excess of par    1,10,000 marketable Securities       12,000 Merchandise Inventory    1,54,250 Prepaid Insurance       11,225 Salaried Expense       42,100 Retained Earning    1,12,205 Dividend Revenue       10,000 Salaries payable       12,350 Sales    9,74,500 Selling Expense    1,29,210 14,58,395 14,58,395

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