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Business
Accounting
Assets Cash FORTEN COMPANY Comparative Balance Sheets December 31 Accounts receivable Inventory Prepaid expenses Total current assets Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable Short-term notes payable Total current liabilities Long-term notes payable Total liabilities Equity Common stock, $5 par value Paid-in capital in excess of par, common stock Retained earnings Total liabilities and equity FORTEN COMPANY Income Statement For Current Year Ended December 31 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense Other expenses Other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income $562,500 285,000 297,500 $ 20,758 132,408 153,150 (5.125) 139,225 24,250 $114,975 Current Year Prior Year $ 49,800 65,810 275,656 $ 73,500 50,625 251,800 1,250 1,875 392,516 157,500 377,800 (36,625) $ 513,391 $ 53,141 10,000 108,000 (46,000) $ 439,800 $ 114,675 6,000 120,675 48,750 63,141 65,000 128,141 169,425 162,750 150, 250 37,500 185.000 $ 513,391 120,125 $ 439,800 Additional Information on Current Year Transactions a. The loss on the cash sale of equipment was $5.125 (details in b b. Sold equipment costing $46,875, with accumulated depreciation of $30125, for $11.625 cash. c. Purchased equipment costing $96,375 by paying $30,000 cash and signing a long-term note payable for the balance. d. Borrowed $4,000 cash by signing a short-term note payable. e. Paid $50,125 cash to reduce the long-term notes payable f. Issued 2,500 shares of common stock for $20 cash per share g. Declared and paid cash dividends of $50,100 Journal entry worksheet < 1 2 3 4 5 6 8 14 Reconstruct the journal entry for depreciation expense, incorporating the change in the related balance sheet account(s), if any. Note: Enter debits before credits. Date December 31 Account Title Debit Credit

Assets Cash FORTEN COMPANY Comparative Balance Sheets December 31 Accounts receivable Inventory Prepaid expenses Total current assets Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable Short-term notes payable Total current liabilities Long-term notes payable Total liabilities Equity Common stock, $5 par value Paid-in capital in excess of par, common stock Retained earnings Total liabilities and equity FORTEN COMPANY Income Statement For Current Year Ended December 31 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense Other expenses Other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income $562,500 285,000 297,500 $ 20,758 132,408 153,150 (5.125) 139,225 24,250 $114,975 Current Year Prior Year $ 49,800 65,810 275,656 $ 73,500 50,625 251,800 1,250 1,875 392,516 157,500 377,800 (36,625) $ 513,391 $ 53,141 10,000 108,000 (46,000) $ 439,800 $ 114,675 6,000 120,675 48,750 63,141 65,000 128,141 169,425 162,750 150, 250 37,500 185.000 $ 513,391 120,125 $ 439,800 Additional Information on Current Year Transactions a. The loss on the cash sale of equipment was $5.125 (details in b b. Sold equipment costing $46,875, with accumulated depreciation of $30125, for $11.625 cash. c. Purchased equipment costing $96,375 by paying $30,000 cash and signing a long-term note payable for the balance. d. Borrowed $4,000 cash by signing a short-term note payable. e. Paid $50,125 cash to reduce the long-term notes payable f. Issued 2,500 shares of common stock for $20 cash per share g. Declared and paid cash dividends of $50,100 Journal entry worksheet < 1 2 3 4 5 6 8 14 Reconstruct the journal entry for depreciation expense, incorporating the change in the related balance sheet account(s), if any. Note: Enter debits before credits. Date December 31 Account Title Debit Credit

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Assets Cash FORTEN COMPANY Comparative Balance Sheets December 31 Accounts receivable Inventory Prepaid expenses Total current assets Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable Short-term notes payable Total current liabilities Long-term notes payable Total liabilities Equity Common stock, $5 par value Paid-in capital in excess of par, common stock Retained earnings Total liabilities and equity FORTEN COMPANY Income Statement For Current Year Ended December 31 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense Other expenses Other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income $562,500 285,000 297,500 $ 20,758 132,408 153,150 (5.125) 139,225 24,250 $114,975 Current Year Prior Year $ 49,800 65,810 275,656 $ 73,500 50,625 251,800 1,250 1,875 392,516 157,500 377,800 (36,625) $ 513,391 $ 53,141 10,000 108,000 (46,000) $ 439,800 $ 114,675 6,000 120,675 48,750 63,141 65,000 128,141 169,425 162,750 150, 250 37,500 185.000 $ 513,391 120,125 $ 439,800 Additional Information on Current Year Transactions a. The loss on the cash sale of equipment was $5.125 (details in b b. Sold equipment costing $46,875, with accumulated depreciation of $30125, for $11.625 cash. c. Purchased equipment costing $96,375 by paying $30,000 cash and signing a long-term note payable for the balance. d. Borrowed $4,000 cash by signing a short-term note payable. e. Paid $50,125 cash to reduce the long-term notes payable f. Issued 2,500 shares of common stock for $20 cash per share g. Declared and paid cash dividends of $50,100 Journal entry worksheet < 1 2 3 4 5 6 8 14 Reconstruct the journal entry for depreciation expense, incorporating the change in the related balance sheet account(s), if any. Note: Enter debits before credits. Date December 31 Account Title Debit Credit
Transcribed Image Text:Assets Cash FORTEN COMPANY Comparative Balance Sheets December 31 Accounts receivable Inventory Prepaid expenses Total current assets Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable Short-term notes payable Total current liabilities Long-term notes payable Total liabilities Equity Common stock, $5 par value Paid-in capital in excess of par, common stock Retained earnings Total liabilities and equity FORTEN COMPANY Income Statement For Current Year Ended December 31 Sales Cost of goods sold Gross profit Operating expenses Depreciation expense Other expenses Other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income $562,500 285,000 297,500 $ 20,758 132,408 153,150 (5.125) 139,225 24,250 $114,975 Current Year Prior Year $ 49,800 65,810 275,656 $ 73,500 50,625 251,800 1,250 1,875 392,516 157,500 377,800 (36,625) $ 513,391 $ 53,141 10,000 108,000 (46,000) $ 439,800 $ 114,675 6,000 120,675 48,750 63,141 65,000 128,141 169,425 162,750 150, 250 37,500 185.000 $ 513,391 120,125 $ 439,800 Additional Information on Current Year Transactions a. The loss on the cash sale of equipment was $5.125 (details in b b. Sold equipment costing $46,875, with accumulated depreciation of $30125, for $11.625 cash. c. Purchased equipment costing $96,375 by paying $30,000 cash and signing a long-term note payable for the balance. d. Borrowed $4,000 cash by signing a short-term note payable. e. Paid $50,125 cash to reduce the long-term notes payable f. Issued 2,500 shares of common stock for $20 cash per share g. Declared and paid cash dividends of $50,100 Journal entry worksheet < 1 2 3 4 5 6 8 14 Reconstruct the journal entry for depreciation expense, incorporating the change in the related balance sheet account(s), if any. Note: Enter debits before credits. Date December 31 Account Title Debit Credit
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