Answered: Prepare the balance sheet

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter5: The Income Statement And The Statement Of Cash Flows

Section: Chapter Questions

Problem 5E: Multiple-Step and Single-Step In coin Statements The following items were derived from Gold...

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111-2 ERP operation FCU The company was established on November 1, XX, adopting the perpetual inventory system, the following is the FCU ransactions of the company in November and December:

11/01 FCU Corporation was formally established, and shareholders contributed $9,000,000 to obtain common stock shares of the company.

11/01 Mortgage $4,800,000 from the bank to buy a machine with a loan interest rate of 3%, loan for 5 years, and repayment of $86,250 at the end of each month. The machine is for business use, with an estimated useful life of 10 years and a residual value of $30,000. column depreciation.

11/01 Hired staff, salary $105,000 per month.

11/05 Purchase $900,000 of merchandise on credit from KFC Corporation on 2/10, n/30, FOB destination.

11/15 Pay KFC in full for the goods.

On 11/25, sell goods worth $1,350,000 on credit to MM Company, the payment terms are 1/10, FOB origin. Cost of goods sold is $529,200.

11/30 Pay employees $105,000 for the month.

12/01 The company issued 3,000 sheets of $1,000 face value, 6-year, 6% bonds for $3,000,000, each year

Interest is due on December 1st.

12/05 Received a credit account of $900,000 from MM Company.

12/08 Received and paid November utility bill of $10,500.

On 12/20, sell goods worth $759,000 on credit to QQ Company, the payment terms are 1/10, FOB delivery point. Cost of goods sold was $336,000.

12/31 estimated bad debts at 1% of accounts receivable.

Prepare the balance sheet