Debit Credit a Cash Accounts receivable, net Inventory Property, plant, and equipment Accumulated depreciation Accounts payable Income taxes payable Notes payable Common stock ($1 par value) Additional paid-in capital Retained earnings, January 1, 2019 Sales-regular Sales-AL Division Cost of sales-regular Cost of sales-AL Division Administrative expenses-regular Administrative expenses-AL Division Interest expense-regular Interest expense-AL Division Loss on sale of AL Division Gain on sale of land 2$ 500,000 1,500,000 2,500,000 15,100,000 $ 4,900,000 2,200,000 200,000 1,000,000 1,000,000 5,800,000 3,000,000 10,100,000 2,000,000 6,200,000 900,000 2,000,000 300,000 210,000 140,000 250,000 300,000 900,000 $30,500,000 $30,500,000 Income tax expense Other financial data for the year ended December 31, 2019: Federal Income Taxes Paid with federal income tax return Accrued Total income tax expense (estimated) Tax rate on all types of taxable income $700,000 200,000 $900,000 40% Discontinued Operations On September 30, 2019, Woodbine sold its Auto Leasing (AL) Division for $4,000,000. The book value of this division was $4,250,000 at that date. For finan- cial statement purposes, this sale was considered as a discontinued operation of a component of the company. Capital Structure Common stock, par value $1 per share. Number of shares outstanding during all of 2019 1,000,000

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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The following items were derived from Woodbine Circle Corporation’s adjusted trial balance on December 31, 2019:

Using the multiple-step format, prepare a formal income statement for Woodbine for the year ended December 31, 2019, together with the appropriate supporting schedules. All income taxes should be appropriately shown.

Debit
Credit
a Cash
Accounts receivable, net
Inventory
Property, plant, and equipment
Accumulated depreciation
Accounts payable
Income taxes payable
Notes payable
Common stock ($1 par value)
Additional paid-in capital
Retained earnings, January 1, 2019
Sales-regular
Sales-AL Division
Cost of sales-regular
Cost of sales-AL Division
Administrative expenses-regular
Administrative expenses-AL Division
Interest expense-regular
Interest expense-AL Division
Loss on sale of AL Division
Gain on sale of land
2$
500,000
1,500,000
2,500,000
15,100,000
$ 4,900,000
2,200,000
200,000
1,000,000
1,000,000
5,800,000
3,000,000
10,100,000
2,000,000
6,200,000
900,000
2,000,000
300,000
210,000
140,000
250,000
300,000
900,000
$30,500,000 $30,500,000
Income tax expense
Other financial data for the year ended December 31, 2019:
Federal Income Taxes
Paid with federal income tax return
Accrued
Total income tax expense (estimated)
Tax rate on all types of taxable income
$700,000
200,000
$900,000
40%
Discontinued Operations
On September 30, 2019, Woodbine sold its Auto Leasing (AL) Division for
$4,000,000. The book value of this division was $4,250,000 at that date. For finan-
cial statement purposes, this sale was considered as a discontinued operation of a
component of the company.
Capital Structure
Common stock, par value $1 per share. Number of shares outstanding during all of 2019
1,000,000
Transcribed Image Text:Debit Credit a Cash Accounts receivable, net Inventory Property, plant, and equipment Accumulated depreciation Accounts payable Income taxes payable Notes payable Common stock ($1 par value) Additional paid-in capital Retained earnings, January 1, 2019 Sales-regular Sales-AL Division Cost of sales-regular Cost of sales-AL Division Administrative expenses-regular Administrative expenses-AL Division Interest expense-regular Interest expense-AL Division Loss on sale of AL Division Gain on sale of land 2$ 500,000 1,500,000 2,500,000 15,100,000 $ 4,900,000 2,200,000 200,000 1,000,000 1,000,000 5,800,000 3,000,000 10,100,000 2,000,000 6,200,000 900,000 2,000,000 300,000 210,000 140,000 250,000 300,000 900,000 $30,500,000 $30,500,000 Income tax expense Other financial data for the year ended December 31, 2019: Federal Income Taxes Paid with federal income tax return Accrued Total income tax expense (estimated) Tax rate on all types of taxable income $700,000 200,000 $900,000 40% Discontinued Operations On September 30, 2019, Woodbine sold its Auto Leasing (AL) Division for $4,000,000. The book value of this division was $4,250,000 at that date. For finan- cial statement purposes, this sale was considered as a discontinued operation of a component of the company. Capital Structure Common stock, par value $1 per share. Number of shares outstanding during all of 2019 1,000,000
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