On January 1, 2020, Norma Smith and Grant Wood formed a computer sales and service company in Soapsville, Arkansas, by investing $90,936 cash. The new company, Coronado Sales and Service, has the following transactions during January. 1. Pays $9,000 in advance for 3 months’ rent of office, showroom, and repair space. 2. Purchases 42 personal computers at a cost of $1,644 each, 8 graphics computers at a cost of $2,644 each, and 27 printers at a cost of $444 each, paying cash upon delivery. 3. Sales, repair, and office employees earn $13,536 in salaries and wages during January, of which $3,936 was still payable at the end of January. 4. Sells 32 personal computers at $2,694 each, 6 graphics computers for $3,744 each, and 17 printers for $644 each; $75,936 is received in cash in January, and $43,684 is sold on a deferred payment basis. 5. Other operating expenses of $9,336 are incurred and paid for during January; $2,936 of incurred expenses are payable at January 31.
prepare (1) a cash-basis income statement and (2) an accrual-basis income statement for the month of January and prepare (1) a cash-basis balance sheet and (2) an accrual-basis balance sheet as of January 31, 2020
Coronado Sales and services |
Cash basis income statement |
For the month ending January 31 2020 |
Revenues : | ||
Sales revenue | 75,936 | |
Cost of goods | 102188 | |
Expenses: | ||
Rent | 9000 | |
Salary | 9600 | |
other expenses | 6400 | |
Cash basis Income or Loss() | (51252) |
Coronado Sales and Services | |||||||||||||||||||||||||||||||||
Accrual basis Income statement | |||||||||||||||||||||||||||||||||
For the month ending January
31 2020
|
Coronado Sales and services |
Cash basis Balance Sheet |
For the month ending January 31 2020 |
Assets: | |
Cash | 39684 |
Inventories | 26168 |
Advance rent | 6000 |
Total Assets | 71852 |
Liabilities: |
|
Owners equity | 71852 |
Coronado Sales and services |
Accrual basis Balance Sheet |
For the month ending January 31 2020 |
Assets: | |
Cash | 39,684 |
Inventories | 26,168 |
Account Receivables | 43,684 |
Advance Rent | 6000 |
Total Assets | 115536 |
Liabilities: | |
Salary payable | 3936 |
Expenses payable | 2936 |
Total Liabilities | 6872 |
Owners Equity | 90936 |
Retained earnings | 17728 |
Total owners equity and Liabilities | 115536 |
On January 1, 2020, Norma Smith and Grant Wood formed a computer sales and service company...
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