Question

WHEEZER INTERNATIONAL accountant for Wheezer International, it is your job to prepare the company's income statement and balance shee hd balance sheet. Use the accounts listed below to construct the statements. Assume that the tax rate is 25%. List of Accounts for Wheezer International (in dollars) Accounts Payable L Accounts Receivable A Advertising Expense Beginning Inventory Bonds Payable Buildings A Cash A Common StockA Depreciation L Ending Inventory A. Equipment & Vehicles A Goodwill f Insurance Expenses Interest Expenses L Land A Merchandise Purchased (for inventory) Net Sales A Notes Payable (Long-term) L Notes Receivable Rent Retained Earningsta Salaries Short-Term Notes Payable Utilities 45,000 120,600 90,000 154,800 60,000 1,050,000 72,000 1,896,000 400,000 126,600 1,066,000 90,000 54,000 24,600 1,500,000 316,800 1,053,000 210,000 61,200 13,800 1,459,800 180,000 15,600 8,400

Answer 1

Wheezer International
Income statement for the Fiscal year 2017
	Amount in $
Revenue
Net sales(i)	1,053,000
Cost of goods sold
Beginning Inventory	154,800
Merchandise purchased	316,800
Cost of goods available for sale	471,600
Less: Closing Inventory	(126,600)
Cost of Goods sold(ii)	345,000
Gross Profit(Gross Margin)(iii=i-ii)	708,000
Operating expenses
Selling Expenses
Salaries	180,000
Advertising	90,000
Total Selling Expenses(iv)	270,000
General Expenses
Insurance	54,000
Interest Expense	24,600
Rent	13,800
Utilities	8,400
Total General Expenses(v)	100,800
Total Operating Expenses(vi= iv+v)	370,800
Net Profit Before Taxes(vii=iii-vi)	337,200
Less Income Tax@25%	84,300
Net Profit after Taxes	252,900

Wheezer International
Balance sheet as at December 31, 2017
	Amount in $
Assets
Current Assets
Cash	72,000
Accounts Receivable	120,600
Notes Receivable	61,200
Inventory	126,600
Total Current assets(i)	380,400
Fixed Assets
Land	1,500,000
Buildings	1,050,000
Equipments and Vehicles	1,066,000
Less: Depreciation	(400,000)
Total Fixed assets(ii)	3,216,000
Other Assets
Goodwill(iii)	90,000
Total Assets(iv=i+ii+iii)	3,686,400
Liabilities and Stockholder's Equity
Current Liabilities
Accounts Payable	45,000
Short Term Notes Payable	15,600
Total Current Liabilities(v)	60,600
Long Term Liabilities
Notes Payable(Long term)	210,000
Bonds	60,000
Total Long term Liabilities(vi)	270,000
Total Liabilities(vii=v+vi)	330,600
Owner's Equity
Common Stock	1,896,000
Retained Earnings	1,459,800
Total Owner's Equity(viii)	3,355,800
Total Liabilities and stockholder's equity(vii+viii)	3,686,400