An accounts clerk prepared the following additional information that should be considered in preparing the financial štatements: Store supplies on hand totalled $4 000 at the end of the period. Depreciation is charged on all fixed assets at the rate of 20 per cent per annuin using the reducing balance basis. Merchandise inventory on hand at November 30, 2007 is $90 000. Bad debts expense is estimated at 2 per cent of net sales. Salaries expense is 70 per cent selling and 30 per cent administrative. Rent and utilities expense is 80 per cent selling and 20 per cent administrative. $60 000 of the notes payable is due for payment the following year. General expense is 100 per cent administrative. The corporation tax rate is 30 per cent. Accounts receivable includes $5 500 due from a customer who went into liquidation on November 15, 2007. The company suffered minor losses due to seasonal flooding. The investments are government bonds that mature on December 1, 2020. The bonds pay 8 per cent interest annually and were acquired in 2006. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. You have just been hired and given the trial balance and additional information above. The directors of the company need a set of financial statements for their board meeting. Prepare a multiple-step income statement and classified balance sheet for Carnival Company for the year ending November 30, 2007. The statements should comply with the requirements of the International Accounting Standards
An accounts clerk prepared the following additional information that should be considered in preparing the financial štatements: Store supplies on hand totalled $4 000 at the end of the period. Depreciation is charged on all fixed assets at the rate of 20 per cent per annuin using the reducing balance basis. Merchandise inventory on hand at November 30, 2007 is $90 000. Bad debts expense is estimated at 2 per cent of net sales. Salaries expense is 70 per cent selling and 30 per cent administrative. Rent and utilities expense is 80 per cent selling and 20 per cent administrative. $60 000 of the notes payable is due for payment the following year. General expense is 100 per cent administrative. The corporation tax rate is 30 per cent. Accounts receivable includes $5 500 due from a customer who went into liquidation on November 15, 2007. The company suffered minor losses due to seasonal flooding. The investments are government bonds that mature on December 1, 2020. The bonds pay 8 per cent interest annually and were acquired in 2006. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. You have just been hired and given the trial balance and additional information above. The directors of the company need a set of financial statements for their board meeting. Prepare a multiple-step income statement and classified balance sheet for Carnival Company for the year ending November 30, 2007. The statements should comply with the requirements of the International Accounting Standards
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Carnival Company is involved in the wholesaling and retailing of household supplies. The
accountant resigned immediately after the following trial balance was extracted from the books
of the company as at November 30, 2007, the end of the company's fiscal year.
Account Titles
Debit (S) Credit (S)
Cash
33 400
Accounts receivable
85 400
Allowance for doubtful accounts
18 000
Merchandise inventory
76 000
Store supplies
11 000
Investments
190 000
Store equipment
170 000
Accumulated depreciation - Store equipment
36 000
Delivery equipment
96 000
Accumulated depreciation - Delivery equipment
18 000
Accounts payable
97 000
Utilities payable
5 600
Notes payable
120 000
Issued ordinary share capital
80 000
Share premium
140 000
Retained earnings
68 500
Sales
1 515 600
Sales returns and allowances
8 400
Purchases
923 200
Purchases returns, allowances and discounts
29 600
Rent and utilities expense
76 000
Freight-in
21 600
Salaries expense
280 000
Advertising expense
26 400
Delivery expense
48 000
General expense
42 900
Interest expense
32 400
Loss due to flood
7 600
Total
2 128 300
2 128 300
2.
Transcribed Image Text:An accounts clerk prepared the following additional information that should be considered in
preparing the financial štatements:
1.
Store supplies on hand totalled $4 000 at the end of the period.
Depreciation is charged on all fixed assets at the rate of 20 per cent per annuin using the
reducing balance basis.
Merchandise inventory on hand at November 30, 2007 is $90 000.
Bad debts expense is estimated at 2 per cent of net sales.
Salaries expense is 70 per cent selling and 30 per cent administrative.
Rent and utilities expense is 80 per cent selling and 20 per cent administrative.
$60 000 of the notes payable is due for payment the following year.
General expense is 100 per cent administrative.
The corporation tax rate is 30 per cent.
Accounts receivable includes $5 500 due from a customer who went into liquidation on
November 15, 2007.
The company suffered minor losses due to seasonal flooding.
The investments are government bonds that mature on December 1, 2020. The bonds
pay 8 per cent interest annually and were acquired in 2006.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
You have just been hired and given the trial balance and additional information above. The
directors of the company need a set of financial statements for their board meeting.
Prepare a multiple-step income statement and classified balance sheet for Carnival Company
for the year ending November 30, 2007. The statements should comply with the requirements
of the International Accounting Standards.
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