Question

Check my work Pope's Garage had the following accounts and amounts in its financial statements on December 31, 2019. Assume that all balance sheet items reflect account balances at December 31, 2019, and that all income statement items reflect activities that occurred during the year then ended. Accounts receivable Depreciation expense Land Cost of goods sold Retained earnings Cash Equipment Supplies Accounts payable Service revenue Interest expense Common stock Income tax expense Accumulated depreciation Long-term debt Supplies expense Merchandise inventory Net sales $ 32,100 11,400 24,900 89,000 56,300 9.400 69,000 5,800 22.500 26,200 1.900 8,000 14,040 43,000 37.000 13.900 25,600 142.000 Required: a. Calculate the total current assets at December 31, 2019 b. Calculate the total liabilities and stockholders' equity at December 31, 2019. Calrate the asrninne from nortinne Innerstinn innmol for the verandert Doramhar 21 2010 < Prev 9 of 9 Next >

Answer 1

Answer-

a. Total Current Assets
Accounts Receivables	32,100
Cash	9,400
Supplies	5,800
Merchandise Inventory	25,600
Total Current Assets	$72,900

b. Total Liabilities& Stock holders'Equity
Liabilities:
Current Liabilities:
Accounts Payable	22500
Total Current Liabilities		22500
Long-term Liabilities
Long-term Debt	37,000
Total Long-term Liabilities		37,000
Total Liabilities		59,500
Stock holders'Equity:
Common Stock	8000
Retained Earnings	56,300
Total Stock holders'Equity:		$64,300
Total Liabilities& Stock holders'Equity		$123,800

c-

Income Statement
Sales Revenue		142000
Service Revenue		26,200
		168,200
Less: COGS		-89,000
Gross Margin		79,200
Less: Operating Expenses:
Depreciation Expense	11,400
Supplies Expense	13,900	-25,300
c-Operating Income		53,900
Less: Other Expenses:
Interest Expense		-1,900
Income before Tax		52,000
Income Tax Expense		-14,040
d-Net Income after tax		37,960

e-Income tax rate= $14,040/ $52,000*100=27%

f-

Retained Earnings Ledger Account for the Year 2019
Opening Balance as on Jan 1		56,300
Net Income for 2019		37,960
Dividends paid	18,500
Closing Balance as on Dec 31,2019		$75760