Question

Henry Josstick has just started his first accounting course and has prepared the following balance sheet and income Omega Corp. Unfortunately, although the data for the individual items are correct, he is very confused as to whether in the balance sheet or income statement and whether it is an asset or liability. BALANCE SHEET Payables $ 35 Inventories Less accumulated depreciation 120 Receivables Total current assets Total current liabilities Long-term debt $350 Interest expense $25 Property, plant, and equipment 520 Total liabilities Net fixed assets Shareholders' equity $90 Total assets Total liabilities and shareholders' equity $50 35 $700 580 38 INCOME STATEMENT Net sales Cost of goods sold Selling, general, and administrative expenses EBIT Debt due for repayment Cash Taxable income Taxes Depreciation Net income $ 25 15 $ 15 12 Prepare the balance sheet and income statement by rearranging the above items. (Be sure to list the assets and liab their liquidity. Enter all amounts as positive values.) BALANCE SHEET Assets Liabilities and Shareholders' Equity $ $ Cash 15 Payables 35

Answer 1

$ $ Balance sheet Liabilities & shareholder's Equity Payables $ 35 Debt due for repayment $ 25 $ 15 35 $ $ $ $ 50 Income statement Net Sales Cost of good sold Gross Profit Selling general & administrative EBIT Interest expenses Taxable Income Taxes Depreciation Net Income $ $ 700 Assets 580 Cash 120 Receivables 38 Inventories 82 Total Current Assets 25 Property.plant& equipment 57 Less:Accumulated depreciation 15 Net fixed assets 12 Total Assets 30 $ 520 $ 120 $ $ $ $ 100 Total current liabilities Long term debt Total Liabilities 400 Shareholder's Equity 500 Total Liabilities & shareholder's Equity $ 60 $ 350 $ 410 $ 90 $ 500 $ $ S