Question

North American Reserve Rare Coins (NARRC) was formed on January 1, 2018. Additional data for the year follow: (Click the icon to view the data.) Read the requirements. Requirement 3. Prepare NARRC's balance sheet at December 31, 2018. North American Reserve Rare Coins Balance Sheet December 31, 2018 Assets Liabilities Current Assets: Current Liabilities: Total Current Liabilities Total Current Assets Stockholders' Equity Property, Plant, and Equipment: Total Stockholders' Equity Total Assets Total Liabilities and Stockholders' Equity

Answer 1

NARRC Journal Enteries Trans. Particulars a. Cash a/c To Common Stock (Common stock issued) Dr. Debit in $ Credit in $ 550000 550000 Dr. Store Fixtures a/c Merchandise Inventory a/c Rent Expense a/c To Cash (Expenses paid) Dr. Dr. 56000 310000 19000 385000 Dr. 236000 Merchandise Inventory a/c To Accounts Payable (Inventory on account) 236000 Dr. 156000 Accounts Payable a/c To Cash (Creditors paid) 156000 d. Dr. 560000 Accounts Receivable a/c To Sales (Sales on account) 560000 Dr. 300000 Cost of goods sold a/c To Merchandise Inventory (To record cost of goods sold) 300000 476000 Cash a/c To Accounts Receivable (Cash from debtors) 560000 x 85% 476000 e. Dr. 90000 Salary Expense a/c To Cash To Salary Payable (Salary paid) 88000 2000 Dr. 24000 Income Tax Expense a/c To Cash (Income Tax Paid) 24000 Dr. 37000 Cash Dividends a/c To Cash (Cash dividends paid) 37000 h. 11200 Depreciation Expense Store fix. a/c Dr. To Accum. Depre - Store fix. (To record depreciation) 56000 / 5 = 11200 11200

Worksheet For the Period ending 31.12.2018 Unadjusted Particulars Debit in $ Credit in $ Cash 336000 Accounts Receivable 84000 Merchandise Inventory 246000 Store Fixtures 56000 Accum. Depre - Store fix. 11200 Accounts Payable 80000 Salary Payable 2000 Common Stock 550000 Cash Dividends 37000 Sales 560000 Cost of goods sold 300000 Rent Expense 19000 Salary Expense 90000 Depreciation Expense Store fix. 11200 Income Tax Expense 24000 Totals 1203200 1203200 Statement of Income For the Period ending 31.12.2018 Sales Cost of goods sold Gross Profit Rent Expense Salary Expense Depreciation Expense Store fix. 560000 -300000 260000 19000 90000 11200 120200 139800 - 24000 115800 Income Tax Expense Net Income Statement of Retained Earnings For the Period ending 31.12.2018 Net Income Cash Dividends 115800 -37000 78800

Amounts in $ Amounts in $ Balance sheet As at May 31 Assets Current Assets Cash Accounts Receivable Merchandise Inventory Amounts in $ Amounts in $ Liabilities Current Liabilities 336000 Accounts Payable 84000 Salary Payable 246000 666000 80000 2000 82000 Non Current Assets Store Fixtures Accum. Depre - Store fix. Total Assets 56000 - 11200 Shareholders Equity Common Stock 44800 Retained Earnings 710800 Total Liabilities & Equity 550000 78800 628800 710800