Month 1:
Month 2:
Month 3:
Month 4:
Cash =?
Net Receivables = 362,500
Inventory = 75,000
Prepaid Expenses = 720,000
Property, Plant, & Equipment =?
Total Assets =?
Accounts Payable = 200,000
Debt & Interest Payable = 3,090,000
Stockholders' Equity =?
Total Liabilities & Stockholders' Equity =?
Thanks!
Asssets | Amount | Liabilities & Shareholders' Equity | Amount | |
Cash (Note 1) | 1,442,500 | Accounts Payable | 200,000 | |
Net Receivables | 362,500 | Debt & Interest Payable | 3,090,000 | |
Inventory | 75,000 | Stockholders' Equity (Note 4) | 1,630,000 | |
Prepaid Expenses | 720,000 | |||
Property Plant and Equipment (Note 2) | 2,320,000 | |||
Total | 4,920,000 | Total (Note 3) | 4,920,000 | |
Note 1 | Statement of Cash | |||
Month 1: | ||||
Cash received from sale of stock | 2,000,000 | |||
Balance Available with bank | 3,000,000 | |||
Less: | Lease Rental Paid | 720,000 | ||
Business Insurance Paid | 360,000 | |||
Closing at month 1 end | 3,920,000 | |||
Month 2: | ||||
Opening Balance | 3,920,000 | |||
Less: | Payment for factory Equipmentv purchased made | 2,400,000 | ||
Payment for Inventory purchased in Month 1 | 800,000 | |||
Payment of 50% for additional inventory purchased for 500000 | 250,000 | |||
Closing at month 2 end | 470,000 | |||
Month 3: | ||||
Opening Balance | 470,000 | |||
Less: | Payment for Inventory purchased in Month 2 (remaining 50%) | 250,000 | ||
Payment of 50% for additional inventory purchased for 300000 | 150,000 | |||
Add: | Cash received from sale made in Month 2 (90% of receivables) | 495,000 | ||
Closing at month 2 end | 565,000 | |||
Month 4: | ||||
Opening Balance | 565,000 | |||
Add: | Cash received from sale made in Month 4 (50% of receivables) | 300,000 | ||
Cash received from sale made in Month 2 (5% of receivables) | 27,500 | |||
Cash received from sale made in Month 3 (90% of receivables) | 720,000 | |||
Less: | Payment for Inventory purchased in Month 3 (remaining 50%) | 150,000 | ||
Dividend paid to shareholders | 20,000 | |||
Closing at month 2 end | 1,442,500 | |||
Note: Depreciation is a non cash expense. | ||||
Lease Rent and Insurance Cost are paid upfront in one instalement therefore not recorded monthly | ||||
Note 2: | Statement of Property Plant and Equipment | |||
Opening Vlaue of Factory Equipment | 2,400,000 | |||
Life of Asset | 10 Years | |||
Depreciation method: Straight Line | ||||
Yearly depreciation | =2400000/10 | 240,000 | ||
Monthly depreciation | =240000/12 | 20,000 | ||
Value of PPE | =2400000-(20000*4) | 2,320,000 | ||
Being depreciation for 4 months charged | ||||
Note 3: | Total of Assets= Total of Liabilities & Shareholders Equity | |||
Therfore, Total of Liabilities & Shareholders Equity= 4920000 | ||||
Note 4: | Total of Liabilities & Shareholders Equity | 4,920,000 | ||
Less: | Accounts Payable | 200,000 | ||
Debt & Interest Payable | 3,090,000 | |||
Shareholders' Equity | 1,630,000 | |||
Month 1: $2,000,000 sale of stock occurs with all cash received by the company. $3,000,000 bank...
Month 1: $2,000,000 sale of stock occurs with all cash received by the company. $3,000,000 bank loan received from the company’s bank at the end of the month – interest will start accruing next month (interest rate is 1% per month). Principal and interest cash payments will be made in a lump-sum payment at the end of the loan period. Factory is leased at the beginning of the month and prepaid for the entire year up-front at a cost of $720,000. The...
Month 1:$2,000,000 sale of stock occurs with all cash received by the company.$3,000,000 bank loan received from the company’s bank at the end of the month – interest will start accruing next month (interest rate is 1% per month). Principal and interest cash payments will be made in a lump-sum payment at the end of the loan period.Factory is leased at the beginning of the month and prepaid for the entire year up-front at a cost of $720,000. The first month of lease expense is expensed to the...
Use T-accounts to record the 4 months’ of transactions noted below for this new start-up company. Record all entries affecting the income statement into “Equity” since there are no separate T-accounts set up for the individual income statement accounts. Once all transactions have been posted, populate the net ending balance for each account for the accounts listed below. Month 1 $2,000,000 sale of stock occurs with all cash received by the company. $3,000,000 bank loan received from the company’s bank...
Prepare journal entries for the transactions below. A company entered into the following transactions during April. This is the first month of their operation. April 1st: Signed a lease and made a payment of $4,500 to the landlord comprised of three month’s rent covering April, May, and June. April 3rd: Purchased equipment on account for $35,000. April 4th: Purchased supplies for $2,000, paid with cash. April 10th: Performed services and sent a bill of $57,000 to a customer. April 15th:...
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Tim Lumber buys $350,000 more inventory, pays $150,000 cash now,
balance due to suppliers next month. Pays cash in Mo. 11 against
Accts Payable starting balance owed from Mo-10 Accts Payable.
Tim Lumber sells $475,000 of inventory to customers for $725,000
net. $450,000 were cash sales, balance of sales on credit due from
customers in 30 days in next month’s accounting period.
$140,000 cash is collected in the current Month-11 period on
Accts Receivable carried over from Mo.10
Building monthly...
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Please do the correct journal entry for the bank loan.
You: Thanks, I now have enough information to deal with the lease, but could you tell me about your bank loan? Indra: Well it's just a line of credit that we took out for $800,000 in September 20X1. The bank can demand repayment within 30 days, and they are currently charging us 4% interest which is the rate they have been charging us for over a year. You: When do...
now
record the single entry needed to show the decrease in cash as a
result of the bank reconciliation.
chart of accounts
y lecorO he adustment for the additions to Cash as a result of the bank reconciliation Date Accounts Debit Credit (z) Cash 1,200 Interest Revenue 1,200 Now record the single entry needed to show the decrease in Cash as a result of the bank reconciliation Date Accounts Debit Credit Choose from any list or enter any number in...