Question

Required information [The following information applies to the questions displayed below. The following data is provided for Garcon Company and Pepper Company Garcon Pepper Company Company Beginning finished goods inventory Beginning work in process inventory Beginning raw materials inventory Rental cost on factory equipment Direct labor Ending finished goods inventory Ending work in process inventory Ending raw materials inventory Factory utilities Factory supplies used General and administrative expenses Indirect labor Repairs-Factory equipment Raw materials purchases Selling expense Sales Cash Factory equipment, net Accounts receivable, net 13,600 18,850 22,800 9,000 24,400 35,400 16,500 16,800 8,200 18,300 8,900 27,750 20,800 20,150 25,000 7,300 11,250 10,600 33,500 16,750 5,800 59,000 9,460 3,700 1,500 4,820 45,000 62,800 229,530 32,000 217,500 16,400 59,500 52,000 332,510 21,700 166,825 21,450 Required: 1-a. Prepare income statements for both Garcon Company and Pepper Company 1-b. Prepare the current assets section of the balance sheet for each company. Complete this question by entering your answers in the tabs below. Req 1ARe 1A Req 1B Req 1B Garcon Pepper Garcon Pepper Prepare the income statement for Garcon Company GARCON COMPAN Income Statement For Year Ended December 31, 2017 Operating expenses Income (loss) before tax 0

Answer 1

(1a) Prepare income statements of G Company and P Company: Income Statement For the period ending ..... G Company | P Company Particulars Amount ($) Amount ($) Sales 229,530 332,510 Less: Cost of goods sold (Working notes) (110,070) (164,160) Gross margin 119,460 168,350 Less: Operating expenses General and administration expenses 33,500 59,000 Selling expenses 62,800 52,000 Net income 23,160 57,350

Working Notes: Calculation of cost of goods manufactured: Amount ($) Amount ($) 01 8,900 45,000 53,900 (7,300 46,600 20.800 9,000 59,500 68,500 (8.200) 60,300 35,400 7 30011 Particulars Direct materials: (a) Beginning raw materials inventory Add: Raw materials purchases Raw materials available for sale Less: Ending raw materials inventory Materials used in production Direct labor (b) Manufacturing overheads: (C) Rental cost of Factory Equipment Factory Utilities Factory Supplies Used Indirect Labor Repairs-Factory Equipment Total manufacturing overheads Total Manufacturing Cost (a + b + c) Add: Beginning work in progress Total cost of work in progress Less: Ending work in progress Cost of goods manufactured 27,750 11,250 10,600 1,500 4,820 55,920 123,320 18,300 141,620 (25,000) 116,620 24,400 16,750 5,800 9,460 3,700 60,110 155,810 22,800 178,610 (16,800) 161,810 1 Calculation of cost of goods sold: 161.810 Particulars Beginning finished goods inventory Add: Cost of goods manufactured Cost of goods available for sale Less: Ending finished goods inventory Cost of goods sold Amount ($) Amount ($) 13,600 18,850 116,620 130,220 180.660 (20,150)| (16,500) 110,070 164,160

(1b) Prepare the current assets section of the balance sheet for both companies: Balance Sheet (Partial) Current Assets Section As on ........... Current Assets Cash Accounts receivable Raw materials inventory Work in process inventory Finished goods inventory Total current assets G Company P Company Amount ($) Amount ($) 32,000 21,700 16,400 21,450 7,300 8,200 25,000 16,800 20,150 16,500 100,850 84,650