A business had the following amounts of assets and liabilities at the beginning and end of a recent year. Assets $ 81,000 Liabilities $34,000 124,000 52,000 Beginning of the year End of the year Determine the profit earned or net loss incurred by the business during the year under each of the following unrelated assumptions: a. The owner made no additional investments in the business and withdrew no assets during the year. b. The owner made no additional investments in the business during the year but withdrew $4,950 per month to pay personal living expenses.

A business had the following amounts of assets and liabilities at the beginning and end of a recent year. Assets $ 81,000 Liabilities $34,000 124,000 52,000 Beginning of the year End of the year Determine the profit earned or net loss incurred by the business during the year under each of the following unrelated assumptions: a. The owner made no additional investments in the business and withdrew no assets during the year. b. The owner made no additional investments in the business during the year but withdrew $4,950 per month to pay personal living expenses.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

The following is information for Novak Corp. for the year ended December 31, 2020: Sales revenue $1,420,000 Loss on inventory due to decline in net realizable value $70,000 Unrealized gain on FV-OCI equity investments 46,000 Loss on disposal of equipment 45,000 Interest income 9,000 Depreciation expense related to buildings omitted by mistake in 2019 56,000 Cost of goods sold 852,000 Retained earnings at December 31, 2019 950,000 Selling expenses 71,000 Loss from expropriation of land 57,000 Administrative expenses 52,000 Dividends declared 46,000 Dividend revenue 15,000 The effective tax rate is 25% on all items. Novak prepares financial statements in accordance with IFRS. The FV-OCI equity investments trade on the stock exchange. Gains/losses on FV-OCI investments are not recycled through net income. a)Prepare the retained earnings section of the statement of changes in equity for 2020. (List…
A Corporation's accounting statement of affairs shows a recovery percentage of 120%. The rate of recovery means that Group of answer choices a.Secured creditors will receive an amount in excess of the book value of their claims b.Unsecured creditors will receive an amount in excess of the book value of their claims c.Stockholders may expect some returns on their interests d.An error was made in the preparation of the statement
what is the net effect of the errors in the 2018 net income?
Give me correct answer and explanation.h
On June 30, Pronghorn Corp discontinued its operations in Mexico. During the year, the operating income was $270,000 before taxes. On September 1, Pronghorn disposed of the Mexico facility at a pretax loss of $670,000. The applicable tax rate is 30%. Show the discontinued operations section of Pronghorn’s income statement. PRONGHORN CORPPartial Income Statement select an opening section name enter an income statement item $enter a dollar amount enter an income statement item $enter a dollar amount $enter a total dollar amount
Following particulars have been obtained from the accounts of a company.i) Remuneration of Managing Director 20,000ii) Provision for Bad debts 10,000iii)Provision for taxation 1,50,000iv) Depreciation written off 80,000v) Loss on sale of investments 70,000vi) Depreciation allowable according to Income-Tax Provisions 70,000vii) Net profit after considering the above items 4,50,000Calculate remuneration of Managing Director at 5% of net profit. The net profit should be as per provisions of Companies Act.
Note:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.
The land that Martin Company paid $81,000 to purchase in the prior year had an appraised market value of $112,000 at the end of the current reporting period. Which of the following shows how the change in market value will affect the company's accounting equation? The letters "NA" indicate that the component of the equation is not affected. A. B. C. D. Assets $ 81,000 $ 31,000 NA $ 112,000 =Liabilities + NA NA ΝΑ ΝΑ = = = = Common Stock NA NA NA ΝΑ Retained Earnings $ 81,000 $ 31,000 ΝΑ $ 112,000
PROBLEM 1 The following differences enter into the reconciliation of accounting and taxable profit of BLACKPINK Company for the year ended December 31, 2021, its first year of operations. Life insurance expense 100,000 Excess tax depreciation 2,000,000 Warranty expense 200,000 Litigation accrual Unamortized computer software 500,000 3,000,000 Unearned rent income deferred on the books but appropriately recognized in taxable profit Interest income from long-term certificate of deposit 400,000 200,000 Additional information: On July 1, 2021, BLACKPINK paid insurance premium of P200,000 on the life of an a. officer with BLACKPINK Company as beneficiary. b. Excess tax depreciation will reverse equally over a four-year period, 2022-2025. c. The warranty liability is the estimated warranty cost that was recognized as expense in 2021 but deductible for tax purposes when actually paid. d. It is estimated that the litigation liability will be paid in 2025. In January 2021, BLACKPINK Company…
The following is the Statement of Financial Position and the Statement of Income for Kaminsky Ltd. Kaminsky Ltd Statement of Financial Position As at December 31, 2020 2020 2019 Assets Cash 24,700 $ 41,750 Accounts receivable 188,500 183,400 Allowance for doubtful accounts (15,000) (16,500) FVTOCI investments 260,000 200,000 FVTPL investments 60,000 80,000 Inventory Prepaid insurance 184,000 161,000 18,000 16.000 665,650 150,000 1,480,000 -580,000 S 1,400,000 $ 1,050,000 $ 2,120,200 $ 1,715,650 $ 720,200 $ Land 400,000 Buildings and equipment Accumulated depreciation 1,650,000 -650,000 Liabilities and Shareholders' Equity Short-term bank loan 22,000 5000 103,600 16,750 Accounts payable Unearned revenues Тах рayable Dividends payable 119,300 20,400 19,900 25,000 16,600 30,000 $ 187,250 S $ 800,000 $ 1,124,950 186,300 Common shares 800,000 Retained earnings 747,350 -18,000 1,529,350 $ 2,120,200 $ 1,715,650 AOC- FVTOCI investments 8,000 1,932,950 Kaminsky Ltd Statement of Income for the…
The following information is available for Reynolds Corporation: Retained Earnings, December 31, 2020 $1,500,000 Profit for the year ended December 31, 2021 250,000 The company accountant, in preparing financial statements for the year ending December 31, 2021, has discovered the following information:The company's previous bookkeeper, who has been fired, had recorded depreciation expense on a machine in 2019 and 2020 using the double diminishing-balance method of depreciation. The bookkeeper neglected to use the straight-line method of depreciation which is the company's policy. The cumulative effect of the error on prior years was $9,000. Depreciation was calculated by the straight-line method in 2021. Reynolds' average tax rate is 22%. During 2021, Reynolds declared and paid cash dividends of $80,000.Instructions a)Calculate the impact on retained earnings. b)Prepare the statement of retained earnings for 2021. Please don't provide solution in an image format thank you
Income from Continuing Operations