1. prepair classified statement of financial position
as at December 31, 2017
2. prepair the closing enteries at December 31 , 2017
3. compute the net profit margin ratio and total asset turnover for
2017, and explain the meaning of each ratio. total assets equalled
$200,000 at January 1, 2017
Requirement 1
Classified financial position as at 31st December,
2017
Particulars Amount Amount
Equity and Liabilities
Shareholders fund
Contributed capital 60,000
Retained earnings
Opening 70,000
For the year 14,920 1,44,920
Current Liabilities
Accounts payable 33,000
Deferred revenue 11,240
Wages outstanding 8,000
Income taxes payable 7,480
Dividend payable 15,000 74,720
Total Equity and Liabilities
2,19,640
Assets
Long term assets
Equipment 60,000
(Less): Accumulated depreciation -12,000
48,000
Current assets
Accounts Receivables 1,00,000
Cash 11,000
Marchandise inventory 18,200
Note Receivables 24,000
Interest on note receivables 600
Prepaid income taxes 1,040
Prepaid rent 16,800 1,71,640
Total Assets 2,19,640
Requirement 2
Closing entries at 31st December 2017
particulars Amount Amount
Wages Expenses 8,000
To Wages expenses outstanding
8,000
Since outstanding wages recorded
Interest receivables on note receivables 600
Interest income 600
Since accured interest recorded
Depreciation epenses 3,000
To Accumulated depreciation
3,000
Since depreciation recorded
Dividend 15,000
To dividend payable 15,000
Since dividend payable recorded
Income tax expenses 7,480
To Income tax payable 7,480
Since tax expenses for the year recorded
Requirement 3
Net profit margin = Net profit after tax/Income
=14,920/3,01,600 4.95%
Net profit margin represent the how much wealth has been added to
shareholders fund as compare to total income
Asset turnover ratio = Total Income/Average assets
=3,01,600/[(2,00,000+2,19,640)/2] =1.44 times
Asset turnover ration represents how much times assets have been
used to generate total income
Working notes
WN 1 Profit and loss account
Particulars Amount Amount
Income
Sales 3,01,000
Interest on note receivables 600
3,01,600
(Less): Expense
Cost of sales -1,29,000
Other operating expenses -1,400
Depreciation expenses -3,000
Rent expenses -11,000
Wages expenses -1,19,800 -2,64,200
Net profit before tax 37,400
(Less): Taxes -7,480
Net profit after taxes 29,920
Dividend declared -15,000
Closing retained earnings
14,920
WN 2 It is assumed wages expenses in trial balance is excluding
outstanding expenses
WN 3 Notes receivable interest calculation
Interest calculation for the preriod for months @
5%
$24,000*5%*1/2= 600
WN 4 Since rent expenses is given in trial balance adjustment for
it has been assumed to be done
1. prepair classified statement of financial position as at December 31, 2017 2. prepair the closing...
P4-7 Recording Adjusting and Closing Entries, Preparing a Statement of Earnings Including Earnings per Share, and Preparing a Statement of Financial Position (AP4-7) It is your first day on the job as a trainee for an entry position in the accounting department of Alimex Inc., a merchandising company. The company controller provides you with the following unadjusted trial balance as at December 31, 2017, with accounts listed in alphabetical order. Debit Credit $ 33,000 $100,000 9,000 11,000 60,000 129.000 11,240...
The comparative statements of financial position of Mikos Inc. as at December 31, 2017 and 2018, and its statement of earnings for the year ended December 31, 2018, are presented below: MIKOS INC. Comparative Statements of Financial Position December 31 2018 2017 Assets Cash $ 10,100 $ 18,100 Short-term investments 63,700 34,300 Accounts receivable 73,500 30,400 Inventories, at cost 56,200 41,100 Prepaid expenses 5,100 8,200 Land 49,400 75,500 Property, plant, and equipment, net 284,400 184,500 Intangible assets 25,100 30,200 $...
Statement of Retained Earnings For the year ended December 31, 2017 Classified Balance Sheet December 31, 2017 (Be sure to include all the necessary subtotals and totals as outlined in Chapter 2. You may not need to use all of the lines provided. Note: The two columns below do not represent debit and credit balances like they do on a trial balance. On the Balance Sheet, use the right column for subtotals and totals.) James Company Adjusted Trial Balance December...
Lamorte Towing Company is at the end of its fiscal year, December 31, 2017. The following data that must be considered were developed from the company’s records and related documents: a. On January 1, 2017, the company purchased a new hauling van at a cash cost of $24,600. Depreciation estimated at $4,000 for the year has not been recorded for 2017. b. During 2017, office supplies amounting to $1,000 were purchased for cash and debited to supplies inventory. At the...
Prepare a classified statement of financial position. Assume that $19,720 of the bank loan payable will be paid in 2019. (List Property, plant and equipment in order of land, buildings and equipment. List Current Assets in order of liquidity.) 'PINA COLADA CORP. Statement of Financial Position Assets These items are taken from the financial statements of Pina Colada Corp. at December 31, 2018. Buildings $153,410 Accounts receivable 18,270 Prepaid insurance 6,786 Cash 17,168 Equipment 119,480 Land 88,740 Office expense 841...
These items are taken from the financial statements of Pharoah Company at December 31, 2017. Buildings Accounts receivable Prepaid insurance Cash Equipment Land Insurance expense Depreciation expense Interest expense Common stock Retained earnings (January 1, 2017) Accumulated depreciation-buildings Accounts payable Notes payable Accumulated depreciation-equipment Interest payable Service revenue $135,424 16,128 4,096 15,155 105,472 78,336 998 6,784 3,328 76,800 51,199 58,368 12,160 119,808 23,962 4,608 18,816 Prepare a classified balance sheet. Assume that $17,408 of the note payable will be paid...
Income Statement and Balance Sheet The following information for Rogers Enterprises is available at December 31, 2019, and includes all of Rogers' financial statement amounts except retained earnings: Accounts receivable $72,920 Cash 13,240 Common stock (10,000 shares) 65,000 Income taxes expense 13,000 Income taxes payable 4,150 Interest expense 16,500 Notes payable (due in 10 years) 25,000 Prepaid rent (building) 31,500 Property, plant, and equipment 90,000 Rent expense 135,000 Retained earnings ? Salaries expense 235,200 Salaries payable 15,710 Service revenue 464,000...
Prepare in proper form a classified Statement of Financial Position as at December 31, 2019 On October 31st, 2019, the company declared $30,000 cash dividends. The dividends were paid on February 12, 2020. On February 15th, 2019, the company declared a 20% common stock dividends when market share price was $30. The shares were distributed on November 15th, 2019 when market share price was $32. On December 31, 2019, the company declared a two-for-one stock split on common shares. Client/Customer...
Prepare in proper form a classified Statement of Financial Position as at December 31, 2019 On October 31st, 2019, the company declared $30,000 cash dividends. The dividends were paid on February 12, 2020. On February 15th, 2019, the company declared a 20% common stock dividends when market share price was $30. The shares were distributed on November 15th, 2019 when market share price was $32. On December 31, 2019, the company declared a two-for-one stock split on common shares. Client/Customer...
Problem 1-3A Preparing an income statement LO P2 As of December 31, 2017, Armani Company's financial records show the following items and amounts. Cash Accounts receivable Supplies Equipment Accounts payable Common stock Retained earnings, Dec. 31, 2016 Retained earnings, Dec. 31, 2017 Dividends Consulting revenue Rental revenue Salaries expense Rent expense Selling and administrative expenses $11,800 10,800 7,800 6, 800 15,900 13,500 5,800 7,800 14,800 36,600 25,600 21,800 13,800 9,800 Required: Prepare the 2017 year-end income statement for Armani Company,...