he comparative balance sheets for 2021 and 2020 and the statement of income for 2021 are given below for Dux Company. Additional information from Dux’s accounting records is provided also. DUX COMPANY Comparative Balance Sheets December 31, 2021 and 2020 ($ in thousands) 2021 2020 Assets Cash $ 195 $ 134 Accounts receivable 60 62 Less: Allowance for uncollectible accounts (4 ) (3 ) Dividends receivable 15 8 Inventory 73 62 Long-term investment 45 40 Land 112 70 Buildings and equipment 351 376 Less: Accumulated depreciation (55 ) (74 ) $ 792 $ 675 Liabilities Accounts payable $ 25 $ 32 Salaries payable 8 11 Interest payable 10 8 Income tax payable 13 14 Notes payable 42 0 Bonds payable 263 190 Less: Discount on bonds (8 ) (9 ) Shareholders' Equity Common stock 270 260 Paid-in capital—excess of par 60 50 Retained earnings 117 119 Less: Treasury stock (8 ) 0 $ 792 $ 675 DUX COMPANY Income Statement For the Year Ended December 31, 2021 ($ in thousands) Revenues Sales revenue $ 320 Dividend revenue 15 $ 335 Expenses Cost of goods sold $ 192 Salaries expense 31 Depreciation expense 11 Bad debt expense 1 Interest expense 20 Loss on sale of building 3 Income tax expense $ 28 286 Net income $ 49 Additional information from the accounting records: A building that originally cost $40,000, and which was three-fourths depreciated, was sold for $7,000. The common stock of Byrd Corporation was purchased for $5,000 as a long-term investment. Property was acquired by issuing a 13%, seven-year, $42,000 note payable to the seller. New equipment was purchased for $15,000 cash. On January 1, 2021, bonds were sold at their $73,000 face value. On January 19, Dux issued a stock dividend (1,000 shares). The market price of the $10 par value common stock was $20 per share at that time. Cash dividends of $31,000 were paid to shareholders. On November 12, 1,100 shares of common stock were repurchased as treasury stock at a cost of $8,000. Required: Prepare the T-account for Dux Company.

he comparative balance sheets for 2021 and 2020 and the statement of income for 2021 are given below for Dux Company. Additional information from Dux’s accounting records is provided also. DUX COMPANY Comparative Balance Sheets December 31, 2021 and 2020 ($ in thousands) 2021 2020 Assets Cash $ 195 $ 134 Accounts receivable 60 62 Less: Allowance for uncollectible accounts (4 ) (3 ) Dividends receivable 15 8 Inventory 73 62 Long-term investment 45 40 Land 112 70 Buildings and equipment 351 376 Less: Accumulated depreciation (55 ) (74 ) $ 792 $ 675 Liabilities Accounts payable $ 25 $ 32 Salaries payable 8 11 Interest payable 10 8 Income tax payable 13 14 Notes payable 42 0 Bonds payable 263 190 Less: Discount on bonds (8 ) (9 ) Shareholders' Equity Common stock 270 260 Paid-in capital—excess of par 60 50 Retained earnings 117 119 Less: Treasury stock (8 ) 0 $ 792 $ 675 DUX COMPANY Income Statement For the Year Ended December 31, 2021 ($ in thousands) Revenues Sales revenue $ 320 Dividend revenue 15 $ 335 Expenses Cost of goods sold $ 192 Salaries expense 31 Depreciation expense 11 Bad debt expense 1 Interest expense 20 Loss on sale of building 3 Income tax expense $ 28 286 Net income $ 49 Additional information from the accounting records: A building that originally cost $40,000, and which was three-fourths depreciated, was sold for $7,000. The common stock of Byrd Corporation was purchased for $5,000 as a long-term investment. Property was acquired by issuing a 13%, seven-year, $42,000 note payable to the seller. New equipment was purchased for $15,000 cash. On January 1, 2021, bonds were sold at their $73,000 face value. On January 19, Dux issued a stock dividend (1,000 shares). The market price of the $10 par value common stock was $20 per share at that time. Cash dividends of $31,000 were paid to shareholders. On November 12, 1,100 shares of common stock were repurchased as treasury stock at a cost of $8,000. Required: Prepare the T-account for Dux Company.

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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Question

he comparative balance sheets for 2021 and 2020 and the statement of income for 2021 are given below for Dux Company. Additional information from Dux’s accounting records is provided also.

DUX COMPANY Comparative Balance Sheets December 31, 2021 and 2020 ($ in thousands)
	2021		2020
Assets
Cash	$	195		$	134
Accounts receivable		60			62
Less: Allowance for uncollectible accounts		(4	)		(3	)
Dividends receivable		15			8
Inventory		73			62
Long-term investment		45			40
Land		112			70
Buildings and equipment		351			376
Less: Accumulated depreciation		(55	)		(74	)
	$	792		$	675
Liabilities
Accounts payable	$	25		$	32
Salaries payable		8			11
Interest payable		10			8
Income tax payable		13			14
Notes payable		42			0
Bonds payable		263			190
Less: Discount on bonds		(8	)		(9	)
Shareholders' Equity
Common stock		270			260
Paid-in capital—excess of par		60			50
Retained earnings		117			119
Less: Treasury stock		(8	)		0
	$	792		$	675

DUX COMPANY Income Statement For the Year Ended December 31, 2021 ($ in thousands)
Revenues
Sales revenue	$	320
Dividend revenue		15	$	335
Expenses
Cost of goods sold	$	192
Salaries expense		31
Depreciation expense		11
Bad debt expense		1
Interest expense		20
Loss on sale of building		3
Income tax expense	$	28		286
Net income			$	49

Additional information from the accounting records:

A building that originally cost $40,000, and which was three-fourths depreciated, was sold for $7,000.
The common stock of Byrd Corporation was purchased for $5,000 as a long-term investment.
Property was acquired by issuing a 13%, seven-year, $42,000 note payable to the seller.
New equipment was purchased for $15,000 cash.
On January 1, 2021, bonds were sold at their $73,000 face value.
On January 19, Dux issued a stock dividend (1,000 shares). The market price of the $10 par value common stock was $20 per share at that time.
Cash dividends of $31,000 were paid to shareholders.
On November 12, 1,100 shares of common stock were repurchased as treasury stock at a cost of $8,000.

Required:
Prepare the T-account for Dux Company.

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