Perez Modems, Inc. acquired a subsidiary named Anywhere, Inc. (Al). Al manufactures a wireless modem that enables users to access the Internet through cell phones. The following trial balance was drawn from the accounts of the subsidiary. Cash Raw materials inventory. Work in process inventory Finished goods inventory Common stock Retained earnings Totals $209,500 4,180 6,290 7,330 $227,300 $135, 130 92,170 $227,300 The subsidiary completed the following transactions during Year 2. 1. Paid $62,850 cash for direct raw materials. 2. Transferred $52,390 of direct raw materials to work in process. 3. Paid production employees $83,830 cash. 4. Applied $55,520 of manufacturing overhead costs to work in process. 5. Completed work on products that cost $170,740. 6. Sold products that cost $149,790 for $190,660 cash. Record the recognition of revenue in a row labeled 6a and the cost of goods sold in a row labeled 6b. 7. Paid $20,950 cash for selling and administrative expenses. 8. Actual overhead costs paid in cash amounted to $57,590. 9. Closed the Manufacturing Overhead account. The amount of over- or underapplied overhead was insignificant (immaterial). 10. Made a $5,220 cash distribution to the owners. Required a. For Anywhere, Inc., record the events in a financial statements model. The first event is shown as an example.
Perez Modems, Inc. acquired a subsidiary named Anywhere, Inc. (Al). Al manufactures a wireless modem that enables users to access the Internet through cell phones. The following trial balance was drawn from the accounts of the subsidiary. Cash Raw materials inventory. Work in process inventory Finished goods inventory Common stock Retained earnings Totals $209,500 4,180 6,290 7,330 $227,300 $135, 130 92,170 $227,300 The subsidiary completed the following transactions during Year 2. 1. Paid $62,850 cash for direct raw materials. 2. Transferred $52,390 of direct raw materials to work in process. 3. Paid production employees $83,830 cash. 4. Applied $55,520 of manufacturing overhead costs to work in process. 5. Completed work on products that cost $170,740. 6. Sold products that cost $149,790 for $190,660 cash. Record the recognition of revenue in a row labeled 6a and the cost of goods sold in a row labeled 6b. 7. Paid $20,950 cash for selling and administrative expenses. 8. Actual overhead costs paid in cash amounted to $57,590. 9. Closed the Manufacturing Overhead account. The amount of over- or underapplied overhead was insignificant (immaterial). 10. Made a $5,220 cash distribution to the owners. Required a. For Anywhere, Inc., record the events in a financial statements model. The first event is shown as an example.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Event
No.
Beg.
Bal.
1.
2.
3.
4.
5.
6a.
6b.
7.
8.
9.
10.
Total
Cash
+
$ 209,500 +
+
+
+
+
+
+
+
+
+
+
+
$ 209,500 +
Manufacturing
Overhead
$
+
+
+
+
+
+
+
+
+
+
+
+
+
Assets
Raw
Materials
$
Balance Sheet
+
4,180 +
62,850 +
(52,390) +
+
+ + + + + + + + +
0 + $ 14,640 +
Work in
Process
$
$
+
6,290 +
+
52,390 +
+
+
+
+
+
+
+
+
+
58,680 +
Finished
Goods
$
$
Equity
Common
Stock
7,330 = $135,130 +
7,330 =
+
+
+
+
++++
+ +
+
Retained
Earnings
$ 92,170
$135,130 + $
92,170
Revenue
$
0
Income Statement
Expense = Net Income
$
||
=
0 =
0
Transcribed Image Text:Perez Modems, Inc. acquired a subsidiary named Anywhere, Inc. (Al). Al manufactures a wireless modem that enables users to access
the Internet through cell phones. The following trial balance was drawn from the accounts of the subsidiary.
Cash
Raw materials inventory
Work in process inventory
Finished goods inventory
Common stock
Retained earnings
Totals
$209,500
4,180
6,290
7,330
$227,300
$135, 130
92,170
$227,300
The subsidiary completed the following transactions during Year 2.
1. Paid $62,850 cash for direct raw materials.
2. Transferred $52,390 of direct raw materials to work in process.
3. Paid production employees $83,830 cash.
4. Applied $55,520 of manufacturing overhead costs to work in process.
5. Completed work on products that cost $170,740.
6. Sold products that cost $149,790 for $190,660 cash. Record the recognition of revenue in a row labeled 6a and the cost of goods
sold in a row labeled 6b.
7. Paid $20,950 cash for selling and administrative expenses.
8. Actual overhead costs paid in cash amounted to $57,590.
9. Closed the Manufacturing Overhead account. The amount of over- or underapplied overhead was insignificant (immaterial).
10. Made a $5,220 cash distribution to the owners.
Required
a. For Anywhere, Inc., record the events in a financial statements model. The first event is shown as an example.
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