Problem 1 Problem 6.8 from textbook Movit Manufacturing has the following alphab
ID: 2565914 • Letter: P
Question
Problem 1 Problem 6.8 from textbook Movit Manufacturing has the following alphabetized income statement and balance sheet entries from the year 2016. Construct an income statement and a balance sheet from the information given $7 500 15 000 2850 2100 150 3000 57 000 Accounts payable Accounts receivable Accrued wages Cash Common shares Contributed capital Cost of goods sold Current assets Current liabilities Deferred income taxes Depreciation expense General expense GICs Income taxes Interest expense Inventories Land Less: Accumulated depreciation Long-term assets Long-term bonds Long-term liabilities Mortgage Net income after taxes Net income before taxes Net plant and equipment Net sales Operating expenses Owners' equity Prepaid expenses Selling expenses Total assets Total current assets Total current liabilities Total expenses Total liabilities and owners' equity Total long-term assets Total long-term liabilities Total owners' equity Working capital loan 2250 750 8100 450 1800 1500 18 000 3000 10 950 4350 9450 2700 4500 7500 76 500 450 4650 46 500 36 000 15 000 15 000 46 500 10 500 16 050 15 450 4650Explanation / Answer
INCOME STATEMENT
Net sales $76500
Cost of goods sold ($57000)
Gross profit $19500
Operating expenses:
Depreciation expense $750
General expense $8100
Selling expense $4650
Interest expense $1500
Total expenses ($15000)
Net income before taxes $4500
Income taxes ($1800)
Net income after taxes $2700.
BALANCE SHEET
ASSETS
CURRENT ASSETS:
Accounts receivable $15000
Cash $2100
Inventories $18000
Prepaid expenses $450
GIC's $450
Total current assets $36000
LONG TERM ASSETS
Land $3000
Plant and equipment $18450
Accummulated depreciation ($10950) $7500
Total long term assets $10500
Total assets $46500
LIABILITIES AND OWNER'S EQUITY
CURRENT LIABILITIES
Accounts payable $7500
Accrued wages $2850
Working capital loan $4650
Total current liabilities $15000
LONG TERM LIABILITIES
Deferred taxes $2250
Long term bonds $4350
Mortgage $9450
Total long term liabilities $16050
OWNERS'S EQUITY
Contributed capital $3000.
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