Create the Income Statement in the proper format, including net sales, COGS, gross profit, expenses and net income. Create a Statement of Owners Equity Provide an ending inventory schedule (schedule should include in good order, details by transaction) Provide the Net Book Value for the equipment Provide only the journal entries for the following: Income allocation between partners Record the monthly bad debt expense Record the monthly depreciation expense Recognize the bad debt write-off for Jenny   Provided information:   Beginning Inventory Schedule (listed in the order they were purchased):       Beginning Inventory 8TT Units Cost Amount 130 $5.00 $650.00 135 $5.20 $702.00 156 $5.50 $858.00  421   $2,210.00 Beginning Inventory CT Units Cost Amount 140 $7.00 $980.00 160 $7.50 $1,200.00 256 $8.00 $2,048.00 556    $4,228.00                 You estimate that VAC will write off 3% of their sales in bad debt. Outbound freight to customers is calculated at $0.50 per unit sold. Shipping supplies (boxes, tape, etc.) are calculated at $0.20 per unit sold. Commission expense is 10% of net sales. For the previous month Michelle sold 60% of the product.  Mary sold the rest.  Office supplies were $500 for the month. VAC is depreciating their packaging equipment on a straight-line basis. The equipment was purchased two years ago on Jan 1.  It cost $46,000 and has a useful life of 7 years, with a salvage value estimated at $4,000.    Inventory Purchases during the month:   Apr 1      Purchased 50 8TT @ $5.00 each                Paid inbound freight of $25 for Apr 1 purchase      Apr 5      Purchased 50 CT @ $8.00 each Apr 8      Purchased 50 8TT @ $5.00 each                Paid inbound freight of $25 for Apr 8 purchase      Apr 10    Purchased 50 CT @ $8.00 each Apr 12    Purchased 50 CT @ $8.00 each Apr 13    Returned 40 CT found to be defective.  Purchase price was $7.00 each Apr 17    Purchased 50 8TT @ $5.00 each                Paid inbound freight of $25 for Apr 17 purchase Apr 20    Purchased 50 CT @ $8.00 each Apr 24    Purchased 100 8TT @ $5.00 each                  Paid freight bill of $50.00 for Apr 24 Apr 27    Purchased 75 CT @ $8.00 each Apr 28    Purchased 75 8TT @ $5.50 each                Paid freight bill of $37.50 for Apr 28 purchases     Apr 29    Purchased 140 CT @ $8.50 each Apr 30    Returned 20 CT found to be defective.  Purchase price was $8 each   Credit Sales during the month:   Apr 3      Sold 65 8TT @ $10 each Apr 3      Sold 75 CT @ $13 each Apr 9      Sold 125 8TT @ $10 each Apr 9      Sold 155 CT @ $13 each Apr 12    Sold 75 8TT @ $10 each Apr 13    Sold 196 CT @ $13 each Apr 18    Sold 120 8TT @ $10 each Apr 18    Sold 180 CT @ $13 each Apr 23    Sold 56 8TT @ $10 each Apr 23    Sold 75 CT @ $13 each Apr 27    Sold 140 8TT @ $10 each Apr 28    Sold 55 CT @ $13 each Apr 30    Sold 130 8TT @ $10 each Apr 30    Sold 140 CT @ $13 each   Beginning capital April-1 Michelle: 10,000.00   Mary: 5,000.00 Total: 15,000.00

Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
icon
Related questions
Question
  1. Create the Income Statement in the proper format, including net sales, COGS, gross profit, expenses and net income.
  2. Create a Statement of Owners Equity
  3. Provide an ending inventory schedule (schedule should include in good order, details by transaction)
  4. Provide the Net Book Value for the equipment
  5. Provide only the journal entries for the following:
    1. Income allocation between partners
    2. Record the monthly bad debt expense
    3. Record the monthly depreciation expense
    4. Recognize the bad debt write-off for Jenny

 

Provided information:

 

Beginning Inventory Schedule (listed in the order they were purchased):    

 

Beginning Inventory 8TT

Units

Cost

Amount

130

$5.00

$650.00

135

$5.20

$702.00

156

$5.50

$858.00

 421

 

$2,210.00

Beginning Inventory CT

Units

Cost

Amount

140

$7.00

$980.00

160

$7.50

$1,200.00

256

$8.00

$2,048.00

556 

 

$4,228.00

 

 

 

 

 

 

 

 

  • You estimate that VAC will write off 3% of their sales in bad debt.
  • Outbound freight to customers is calculated at $0.50 per unit sold.
  • Shipping supplies (boxes, tape, etc.) are calculated at $0.20 per unit sold.
  • Commission expense is 10% of net sales. For the previous month Michelle sold 60% of the product.  Mary sold the rest. 
  • Office supplies were $500 for the month.
  • VAC is depreciating their packaging equipment on a straight-line basis. The equipment was purchased two years ago on Jan 1.  It cost $46,000 and has a useful life of 7 years, with a salvage value estimated at $4,000. 

 

Inventory Purchases during the month:

 

Apr 1      Purchased 50 8TT @ $5.00 each

               Paid inbound freight of $25 for Apr 1 purchase     

Apr 5      Purchased 50 CT @ $8.00 each

Apr 8      Purchased 50 8TT @ $5.00 each

               Paid inbound freight of $25 for Apr 8 purchase     

Apr 10    Purchased 50 CT @ $8.00 each

Apr 12    Purchased 50 CT @ $8.00 each

Apr 13    Returned 40 CT found to be defective.  Purchase price was $7.00 each

Apr 17    Purchased 50 8TT @ $5.00 each

               Paid inbound freight of $25 for Apr 17 purchase

Apr 20    Purchased 50 CT @ $8.00 each

Apr 24    Purchased 100 8TT @ $5.00 each  

               Paid freight bill of $50.00 for Apr 24

Apr 27    Purchased 75 CT @ $8.00 each

Apr 28    Purchased 75 8TT @ $5.50 each

               Paid freight bill of $37.50 for Apr 28 purchases    

Apr 29    Purchased 140 CT @ $8.50 each

Apr 30    Returned 20 CT found to be defective.  Purchase price was $8 each

 

Credit Sales during the month:

 

Apr 3      Sold 65 8TT @ $10 each

Apr 3      Sold 75 CT @ $13 each

Apr 9      Sold 125 8TT @ $10 each

Apr 9      Sold 155 CT @ $13 each

Apr 12    Sold 75 8TT @ $10 each

Apr 13    Sold 196 CT @ $13 each

Apr 18    Sold 120 8TT @ $10 each

Apr 18    Sold 180 CT @ $13 each

Apr 23    Sold 56 8TT @ $10 each

Apr 23    Sold 75 CT @ $13 each

Apr 27    Sold 140 8TT @ $10 each

Apr 28    Sold 55 CT @ $13 each

Apr 30    Sold 130 8TT @ $10 each

Apr 30    Sold 140 CT @ $13 each

 

Beginning capital April-1 Michelle: 10,000.00   Mary: 5,000.00 Total: 15,000.00

Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps

Blurred answer
Knowledge Booster
Aggregate planning
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, operations-management and related others by exploring similar questions and additional content below.
Similar questions
Recommended textbooks for you
Practical Management Science
Practical Management Science
Operations Management
ISBN:
9781337406659
Author:
WINSTON, Wayne L.
Publisher:
Cengage,
Operations Management
Operations Management
Operations Management
ISBN:
9781259667473
Author:
William J Stevenson
Publisher:
McGraw-Hill Education
Operations and Supply Chain Management (Mcgraw-hi…
Operations and Supply Chain Management (Mcgraw-hi…
Operations Management
ISBN:
9781259666100
Author:
F. Robert Jacobs, Richard B Chase
Publisher:
McGraw-Hill Education
Business in Action
Business in Action
Operations Management
ISBN:
9780135198100
Author:
BOVEE
Publisher:
PEARSON CO
Purchasing and Supply Chain Management
Purchasing and Supply Chain Management
Operations Management
ISBN:
9781285869681
Author:
Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Publisher:
Cengage Learning
Production and Operations Analysis, Seventh Editi…
Production and Operations Analysis, Seventh Editi…
Operations Management
ISBN:
9781478623069
Author:
Steven Nahmias, Tava Lennon Olsen
Publisher:
Waveland Press, Inc.