McGuire Corporation began operations in 2024. The company purchases computer equipment from manufacturers and then sells toretail stores. During 2024, the bookkeeper used a check register to record all cash receipts and cash disbursements. No otherjournals were used. The following is a recap of the cash receipts and disbursements made during the year.O Cash receipts:Issue of common stockCollections from customersBorrowed from local bank on April 1, note signed requiring principal and interest at 12% to be paid on March 31,2025Total cash receiptsCash disbursements:Purchase of inventoryPayment of salariesPurchase of office equipmentPayment of rent on buildingMiscellaneous expenseTotal cash disbursements$ 75,000335,00037,000$ 447,000Required:Prepare an income statement for 2024 and a balance sheet as of December 31, 2024.$ 202,50080,50045,00011,25013,100$352,350You are called in to prepare financial statements on December 31, 2024. The following additional information was provided to you:1. Customers owed the company $20,500 at year-end.2. At year-end, $30,450 was still due to suppliers of inventory purchased on credit.3. At year-end, inventory costing $48,200 still remained on hand.4. Salaries owed to employees at year-end amounted to $5,550.5. On December 1, $3,600 in rent was paid to the owner of the building used by McGuire. This represented rent for the months ofDecember through February.6. The office equipment, which has a ten-year life and no salvage value, was purchased on January 1, 2024. Straight-line depreciationis used.

An income statement is prepared for a particular period, which helps the company to determine the…

McGuire Corporation began operations in 2024. The company purchases computer equipment from manufacturers and then sells to retail stores. During 2024, the bookkeeper used a check register to record all cash receipts and cash disbursements. No other journals were used. The following is a recap of the cash receipts and disbursements made during the year. Cash receipts: Issue of common stock Collections from customers Borrowed from local bank on April 1, note signed requiring principal and interest at 12% to be paid on March 31, 2025 Total cash receipts Cash disbursements: Purchase of inventory Payment of salaries Purchase of office equipment Payment of rent on building Miscellaneous expense Total cash disbursements $ 75,000 335,000 37,000 $ 447,000 $ 202,500 80,500 45,000 11,250 13,100 $ 352,350

McGuire Corporation began operations in 2024. The company purchases computer equipment from manufacturers and then sells to retail stores. During 2024, the bookkeeper used a check register to record all cash receipts and cash disbursements. No other journals were used. The following is a recap of the cash receipts and disbursements made during the year. Cash receipts: Issue of common stock Collections from customers Borrowed from local bank on April 1, note signed requiring principal and interest at 12% to be paid on March 31, 2025 Total cash receipts Cash disbursements: Purchase of inventory Payment of salaries Purchase of office equipment Payment of rent on building Miscellaneous expense Total cash disbursements $ 75,000 335,000 37,000 $ 447,000 $ 202,500 80,500 45,000 11,250 13,100 $ 352,350

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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