Question

Question 1 - The Income Statement Using Figure 2-1 on page 15 as your Income Statement form, review the following facts and prepare an Income Statement. Charlie's Chairs has the following expenses and sales revenue for the year: Cost of Goods Sold ----- $6,358,000 Income Tax Expense ---- $458,000 Interest Expense ---- $684,000 Wages Expense --- $2,500,000 Rent ----$500,000 Selling Expenses ---- $1,000,000 Depreciation ---- $300,000 Amortization ----$75,000 Sales Revenue ---- $13,125,000 Question 2 - The Balance Sheet Using Figure 2-5 on page 25 as your Balance Sheet form, review the following facts and prepare a Balance Sheet. Donna's Realty Company has the following assets and liabilities: Cash ---- $2,960,000 Office Equipment ---- $950,000 Office Salaries Payable ---- $220,000 Donna Dee's Capital ---- $1,000,000 Office Supplies in Inventory ---- $75,000 Accounts Payable ---- $1,065,000 Buildings ---- $3,030,000 Accumulated Depreciation (Buildings) ---- $, 1,000,000 Accounts Receivable ---- $1,250,000 Automobiles ---- $50,000 Bank Loans ---- $865,000 Mortgages ---- $1,850,000 Retained Earnings ---- $2,315,000

Answer 1

Answer 1)

Answer 1 charlie's chair Income Statement Amount $13125000 $ 6358000 6767000 Particular Revenue Expenses Cost of good sold Gross Profit Operating Expenses Wages Rent Selling Expenses Depreciation Amortization Total operating Expenses Operating profit or Profit before Interest Expense $ 250.000 $ 500000 $ 1000000 $ 300000 $ 75000 $ 4375000 $2392000 interest and taxes $684000 $1708000 Profit Before Taxes Income tax expense $ 458000 Net Income $ 1250000

Answer 2)

Total Shareholder Sequity Answer 2) Donna's Realty Company Balance sheet Particular Amount Assets Current Asset Cash $2960000 Account Receivables $1250000 Inventory Coffice Supplies) $ 75000 Total Current Assets $ 4285000 Property, plant and Equipments office Equipements 950000 Building $ 3030000 (Less) Accumulate Depreciation $ 1oooooo Total Property, plant and Equipment $2980000 other Assets Automobiles Total other assets Total Assets. $7315000 Liabilities and shareholder Equity Current Liabilities Accounts payable $1066ooo Salaries Payable $ 220000 Total Current Habilities $1285000 $ 865000 Mortgages $1850ooo Total Long term Liabilities $2715000 Share holder Equity, Contributed Capital $1000,000 Retained earning $2315,000 $3315000 Shareholder Equity $ 7315000 $ 50000 $50,000 Long term Liabilities Bank loans Total Liabilities and

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