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Income statement and balance sheet

Income statement and balance sheet

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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Income statement and balance sheet
Using the tabular analysis of business transactions, prepare, in good form, the income statement and balance sheet of IE Company for the year ended December 31, 2022. The balances of specific accounts for IE Company as of December 31, 2021 are presented below. Cash 12,582 Accounts receivable 155,865 184,378 Merchandise inventory Prepaid asset 30.000 Land 500,500 Building 360,000 Accum. depn. - building 120,000 Equipment 123,200 Accum. depn. - equipment 12,320 Accounts payable 148,756 Accrued expenses 48,732 Short-term loan payable 80,000 240,000 Long-term loan payable Capital stock 500,000 Retained eamings 216,717 The following transactions occurred in 1. IE Company sold merchandise worth P30,000 at 100% margin. The customer paid in cash. 2. IE Company sold, on credit, merchandise worth P60,000 for $105,000. 3. IE Company bought merchandise worth $50,000 paying 25% in cash and the remainder under credit. 4. IE Company recorded salaries expense amounting to P25,000 in 2022. All but 10% remain unpaid as of year-end. 5. The accrued expenses as of end-2021 pertains to unpaid utilities. The entire amount was subsequently paid in 2022. 6. The prepaid asset pertains to a three-year insurance policy covering 2022, 2023 and 2024. P10,000 for the insurance coverage in 2022 was recognized as expense. 7. The entity took out a four-year loan in 2021 payable in equal annual installments of P80,000. The short-term portion recorded as of end-2021 was fully paid in 2022. Corresponding interest payment amounting to P6,000 was also made. (Hint: In preparing the balance sheet, recognize and present separately the portion of the loan maturing within the next 12 months as current.) 8. The building and equipment recorded depreciation of P120,000 and P24,640 during the year. 9. IE Company collected P225,000 of accounts receivable and paid P58,000 of accounts payable. Upload Choose a File DEI At - - P
Transcribed Image Text:Using the tabular analysis of business transactions, prepare, in good form, the income statement and balance sheet of IE Company for the year ended December 31, 2022. The balances of specific accounts for IE Company as of December 31, 2021 are presented below. Cash 12,582 Accounts receivable 155,865 184,378 Merchandise inventory Prepaid asset 30.000 Land 500,500 Building 360,000 Accum. depn. - building 120,000 Equipment 123,200 Accum. depn. - equipment 12,320 Accounts payable 148,756 Accrued expenses 48,732 Short-term loan payable 80,000 240,000 Long-term loan payable Capital stock 500,000 Retained eamings 216,717 The following transactions occurred in 1. IE Company sold merchandise worth P30,000 at 100% margin. The customer paid in cash. 2. IE Company sold, on credit, merchandise worth P60,000 for $105,000. 3. IE Company bought merchandise worth $50,000 paying 25% in cash and the remainder under credit. 4. IE Company recorded salaries expense amounting to P25,000 in 2022. All but 10% remain unpaid as of year-end. 5. The accrued expenses as of end-2021 pertains to unpaid utilities. The entire amount was subsequently paid in 2022. 6. The prepaid asset pertains to a three-year insurance policy covering 2022, 2023 and 2024. P10,000 for the insurance coverage in 2022 was recognized as expense. 7. The entity took out a four-year loan in 2021 payable in equal annual installments of P80,000. The short-term portion recorded as of end-2021 was fully paid in 2022. Corresponding interest payment amounting to P6,000 was also made. (Hint: In preparing the balance sheet, recognize and present separately the portion of the loan maturing within the next 12 months as current.) 8. The building and equipment recorded depreciation of P120,000 and P24,640 during the year. 9. IE Company collected P225,000 of accounts receivable and paid P58,000 of accounts payable. Upload Choose a File DEI At - - P
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