what am I doing wrong? I can\'t balance my B.S. please help! Integration Exercis
ID: 2581520 • Letter: W
Question
what am I doing wrong? I can't balance my B.S. please help!
Integration Exercise 9 Master Budgeting LO 8-2.LO 8-3 g. LO 8-4@, LO 8-5 ig , LO 8-6 (9 . LO 8-7 , LO 8-8 . LO 8-9 © , LO 8-10 Endless Mountain Company manufactures a single product that is popular with outd recreation enthusiasts. The company sells its product to retailers throughout the northeastern quadrant of the United States. It is in the process of creating a master budget for 2017 and reports a balance sheet at December 31. 2016, as follows: Page 769 200 8IS /s 392,0006 60, ooo (5 +32,000 7 Endiess Mountain Company Balance Sheet December 31, 2016 s Curent assets Cas r Accounts receivable s Raw mabenats inventory (4,500 yards) t Firshed goods inventory (1 500 unts) 11 Total curreet assets 12 Plant and equpment ) Buidings and equpment S 46 200 200,000 11,250 32 250 $ 349 700 900 000 Accumasted Plant and equipment net Totai assets 957 TOO Liabilites and Stockholders Equity s Current labábes 20 Accounts payable 14.0 83400 00 5 158,000 S 419.800 379 900 z2 Common stock z) Retained earings 24 Total saockhoiders equty 2s Total I abilbes and stockhoiders equy 799700 hoiders equry uvn 46 50t CoOS unit) 32 250 Cg 00units 51 - 1,500 87, 500 X22:46Explanation / Answer
The followings mistakes are there in your i.e.
1. Accounts Payable which is to be 30% not 70% in balance sheet
2. In calculating retained earnings at the end the dividend has to be deducted and not added
3. The closing inventory and Cost of goods sold are taken by you is wrong because you have taken the figures as per FIFO method but as per question LIFO method has to be followed.
4. So in balance sheet both raw materials and finished goods are wrong. and Cost of goods sold schedule is also worng because the inventory of raw materials and finished goods both has to be on LIFO basis.
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