Question

Company X had a beginning inventory of 22 units at December 31, 2016, valued at $811,000 with a 6 month note at 6% may 2020. The company had a number of purchases during the new year equal to $352,000. The ending inventory count indicated 60 units valued at $493,100. Assume Sales for the year were $1,105,000 and the tax rate was 23%. Assume General Administration expenses for the year were $61,000. The company had an external gain of 49,000.

Prepare an income statement in good form for the Company X.

Assume that there are 350,000 COMMON shares outstanding at year-end, 85,000 shares were issued April 15, and 100,000 were issued on September 30. at 14$. the beginning balance was valued at 10$ per share. There were 5,000 preferred shareholders who contributed $2,000,000 to earn 8% per year.

please create a balance sheet and income statement

Answer 1

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Company X
Answer to Question 4
Cost of goods sold	Amount $
Beginning Raw material inventory	811,000.00
Add: Raw material Purchases	352,000.00
Total Raw material available for use	1,163,000.00
Less: Ending Raw material inventory	493,100.00
Cost of goods sold	669,900.00
Income Statement	Amount $
Sales Revenues
Sales Revenues	1,105,000.00
External gain	49,000.00
Total Revenue	1,154,000.00
Less: Cost of goods sold	669,900.00
Gross Profit	484,100.00
Less: Operating Expenses
General Administration expenses	61,000.00
Interest expense (811,000*6%)	48,660.00
Total Operating Expenses	109,660.00
Income before tax	374,440.00
Less- Tax at 23%	86,121.20
Net Income	288,318.80
Less: Preference Dividend	160,000.00
(2000000*8%)
Net Income for common shareholders	128,318.80
Number of shares outstanding	100,000.00
Earnings per share	0.78

Balance Sheet
Current Assets	Amount $	Amount $
Inventory		493,100.00
Total Current Assets		493,100.00
Total Assets		493,100.00
Liabilities & Stockholder's Equity
Current Liabilities
Stockholder's Equity
Common Stock	1,400,000.00	This is 100,000 shares* $ 14 per share.
Preferred Stock	2,000,000.00
Retained Earnings	128,318.80	This is Net Income for common shareholders
Total Stockholder's Equity		3,528,318.80
Total Liabilities & Stockholder's Equity		3,528,318.80