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Problem- The following accounts were taken from the ledger of Dada Merchandising as of May 31, 2012; Required: 1. Income Statement with supporting notes Inventory, May 1 Inventory, May 31 Office Supplies Used Office Supplies Inventory Store Supplies Used Store Supplies on Hand Freight In Freight Out Dividend Income D MERCHANDISING 30,000 80,000 INCOME STATEMENT 5,000 6,000 4,000 6.000 FOR THE YEAR ENDED MAY 31, 2012 PARTICULARS AMOUNT AMOUNT REVENUE 1,000 2,000 4,000 600,000.00 (3,600.00) (30,000.00) SALES LESS: SALES DISCOUNT LESS: SALES RETURN AND ALLOWANCES NET SALES 566,400.00 6,000 3,000 Rent Income Interest Expense OTHER INCOME Purchases 350.000 4,000.00 6,000.00 DIVIDEND INCOME 20,000 3,000 25,000 15,000 3.000 300.000 RENT INCOME TOTAL REVENUE AND INCOME (a) Purchase Returns and Allowances Purchase Discount 576,400.00 Accounts Payable Notes Payable Taxes Payable Mortgage Payable Miscellaneous Selling Expenses Miscellaneous General Expenses Postage and Telegraph Sales Salaries Office Salaries Advertising Expense Insurance- Office Building Insurance- Store Building Heat, Light and Power Rent Expense Bad Debts Depreciation- Store Building Depreciation- Office Building COST OF SALES INVENTORY, MAY 1 PURCHASES 30,000.00 350,000.00 1,000.00 (3,000.00) (20,000.00) (80,000.00) ADD: FREIGHT INI LESS: PURCHASE DISCOUNT 7,000 3,000 1,200 40,000 30,000 800 LESS: PURCHASE RETURN AND ALLOWANCES LESS: INVENTORY, MAY 31 COST OF SALES (b) 278,000.00 OPERATING EXPENSES 2,000.00 5,000.00 3,000.00 20,000.00 15,000.00 1,500.00 2,000.00 7,000.00 3,000.00 1,200.00 40,000.00 30,000.00 800.00 FREIGHT OUT SUPPLIES EXPENSE LOSS FROM SALE OF OFFICE BUILDING DEPRECIATION- STORE BUILDING 4,000 6.000 1,400 2,000 1,500 20,000 15,000 DEPRECIATION- OFFICE BUILDING BAD DEBTS RENT EXPENSES MISCELLANEOUS SELLING EXPENSES MISCELLANEOUS GENERAL EXPENSES POSTAGE AND TELEGRAPH SALES SALARIES OFFICE SALARIES ADVERTISING EXPENSE INSURANCE- OFFICE BUILDING INSURANCE- STORAGE BUILDING HEAT, LIGHT AND POWER INTEREST EXPENSE Cash 40.000 50.000 100,000 8,000 400,000 40,000 600,000 75,000 600.000 3,600 30,000 672,500 Notes Receivable Accounts Receivable 4,000.00 6,000.00 1,400.00 3,000.00 Allowance for Bad Debts Store Building Accumulated Depreciation- Store Building Office Building Accumulated Depreciation- Office Building Sales Sales Discounts Sales Returns and Allowances Dada, Capital TOTAL OPERATING EXPENSE (c) 144,900.00 NET PROFIT DURING THE MONTH 153,500.00

Problem- The following accounts were taken from the ledger of Dada Merchandising as of May 31, 2012; Required: 1. Income Statement with supporting notes Inventory, May 1 Inventory, May 31 Office Supplies Used Office Supplies Inventory Store Supplies Used Store Supplies on Hand Freight In Freight Out Dividend Income D MERCHANDISING 30,000 80,000 INCOME STATEMENT 5,000 6,000 4,000 6.000 FOR THE YEAR ENDED MAY 31, 2012 PARTICULARS AMOUNT AMOUNT REVENUE 1,000 2,000 4,000 600,000.00 (3,600.00) (30,000.00) SALES LESS: SALES DISCOUNT LESS: SALES RETURN AND ALLOWANCES NET SALES 566,400.00 6,000 3,000 Rent Income Interest Expense OTHER INCOME Purchases 350.000 4,000.00 6,000.00 DIVIDEND INCOME 20,000 3,000 25,000 15,000 3.000 300.000 RENT INCOME TOTAL REVENUE AND INCOME (a) Purchase Returns and Allowances Purchase Discount 576,400.00 Accounts Payable Notes Payable Taxes Payable Mortgage Payable Miscellaneous Selling Expenses Miscellaneous General Expenses Postage and Telegraph Sales Salaries Office Salaries Advertising Expense Insurance- Office Building Insurance- Store Building Heat, Light and Power Rent Expense Bad Debts Depreciation- Store Building Depreciation- Office Building COST OF SALES INVENTORY, MAY 1 PURCHASES 30,000.00 350,000.00 1,000.00 (3,000.00) (20,000.00) (80,000.00) ADD: FREIGHT INI LESS: PURCHASE DISCOUNT 7,000 3,000 1,200 40,000 30,000 800 LESS: PURCHASE RETURN AND ALLOWANCES LESS: INVENTORY, MAY 31 COST OF SALES (b) 278,000.00 OPERATING EXPENSES 2,000.00 5,000.00 3,000.00 20,000.00 15,000.00 1,500.00 2,000.00 7,000.00 3,000.00 1,200.00 40,000.00 30,000.00 800.00 FREIGHT OUT SUPPLIES EXPENSE LOSS FROM SALE OF OFFICE BUILDING DEPRECIATION- STORE BUILDING 4,000 6.000 1,400 2,000 1,500 20,000 15,000 DEPRECIATION- OFFICE BUILDING BAD DEBTS RENT EXPENSES MISCELLANEOUS SELLING EXPENSES MISCELLANEOUS GENERAL EXPENSES POSTAGE AND TELEGRAPH SALES SALARIES OFFICE SALARIES ADVERTISING EXPENSE INSURANCE- OFFICE BUILDING INSURANCE- STORAGE BUILDING HEAT, LIGHT AND POWER INTEREST EXPENSE Cash 40.000 50.000 100,000 8,000 400,000 40,000 600,000 75,000 600.000 3,600 30,000 672,500 Notes Receivable Accounts Receivable 4,000.00 6,000.00 1,400.00 3,000.00 Allowance for Bad Debts Store Building Accumulated Depreciation- Store Building Office Building Accumulated Depreciation- Office Building Sales Sales Discounts Sales Returns and Allowances Dada, Capital TOTAL OPERATING EXPENSE (c) 144,900.00 NET PROFIT DURING THE MONTH 153,500.00

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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TRANSFORM IT TO FUNCTIONAL PRESENTATION USING THE FORMAT ON THE SECOND PICTURE

Problem- The following accounts were taken from the ledger of Dada Merchandising as of May 31, 2012; Required: 1. Income Statement with supporting notes Inventory, May 1 Inventory, May 31 Office Supplies Used Office Supplies Inventory Store Supplies Used Store Supplies on Hand Freight In Freight Out Dividend Income Rent Income Interest Expense Purchases Purchase Returns and Allowances Purchase Discount Accounts Payable Notes Payable Taxes Payable Mortgage Payable Miscellaneous Selling Expenses Miscellaneous General Expenses Postage and Telegraph Sales Salaries Office Salaries Advertising Expense 30,000 D MERCHANDISING 80,000 5,000 INCOME STATEMENT FOR THE YEAR ENDED MAY 31, 2012 6,000 4,000 PARTICULARS AMOUNT AMOUNT 6,000 REVENUE 1,000 2,000 4,000 SALES LESS: SALES DISCOUNT LESS: SALES RETURN AND ALLOWANCES NET SALES 600,000.00 (3,600.00) (30,000.00) 566.400.00 6,000 3,000 OTHER INCOME 350,000 4,000.00 6,000.00 DIVIDEND INCOME 20,000 RENT INCOME TOTAL REVENUE AND INCOME (a) 576,400.00 3,000 25,000 COST OF SALES 15,000 3,000 INVENTORY, MAY 1 30,000.00 PURCHASES 350,000.00 1,000.00 (3,000.00) (20,000.00) (80,000.00) 300,000 7,000 ADD: FREIGHT IN LESS: PURCHASE DISCOUNT LESS: PURCHASE RETURN AND ALLOWANCES 3,000 LESS: INVENTORY, MAY 31 COST OF SALES (b) 1,200 40,000 30.000 278,000.00 OPERATING EXPENSES FREIGHT OUT SUPPLIES EXPENSE LOSS FROM SALE OF OFFICE BUILDING DEPRECIATION- STORE BUILDING DEPRECIATION- OFFICE BUILDING 2,000.00 5,000.00 3,000.00 20,000.00 15,000.00 1,500.00 2,000.00 7,000.00 800 Insurance- Office Building Insurance- Store Building Heat, Light and Power Rent Expense Bad Debts Depreciation- Store Building Depreciation- Office Building Cash Notes Receivable Accounts Receivable 4,000 6,000 1,400 2,000 1,500 20,000 BAD DEBTS RENT EXPENSES MISCELLANEOUS SELLING EXPENSES MISCELLANEOUS GENERAL EXPENSES POSTAGE AND TELEGRAPH SALES SALARIES 3,000.00 15,000 40,000 50.000 100,000 1,200.00 40,000.00 30,000.00 OFFICE SALARIES ADVERTISING EXPENSE 800.00 INSURANCE- OFFICE BUILDING 4,000.00 Allowance for Bad Debts 8,000 INSURANCE- STORAGE BUILDING HEAT, LIGHT AND POWER INTEREST EXPENSE TOTAL OPERATING EXPENSE (c) 6.000.00 Store Building 400,000 40,000 1,400.00 3,000.00 Accumulated Depreciation- Store Building Office Building Accumulated Depreciation- Office Building 600,000 144,900.00 NET PROFIT DURING THE MONTH 153,500.00 75,000 600,000 3,600 30,000 672,500 Sales Sales Discounts Sales Returns and Allowances Dada, Capital 6,000 3,000 Dada, Drawing Loss from Sale of Office Building
Transcribed Image Text:Problem- The following accounts were taken from the ledger of Dada Merchandising as of May 31, 2012; Required: 1. Income Statement with supporting notes Inventory, May 1 Inventory, May 31 Office Supplies Used Office Supplies Inventory Store Supplies Used Store Supplies on Hand Freight In Freight Out Dividend Income Rent Income Interest Expense Purchases Purchase Returns and Allowances Purchase Discount Accounts Payable Notes Payable Taxes Payable Mortgage Payable Miscellaneous Selling Expenses Miscellaneous General Expenses Postage and Telegraph Sales Salaries Office Salaries Advertising Expense 30,000 D MERCHANDISING 80,000 5,000 INCOME STATEMENT FOR THE YEAR ENDED MAY 31, 2012 6,000 4,000 PARTICULARS AMOUNT AMOUNT 6,000 REVENUE 1,000 2,000 4,000 SALES LESS: SALES DISCOUNT LESS: SALES RETURN AND ALLOWANCES NET SALES 600,000.00 (3,600.00) (30,000.00) 566.400.00 6,000 3,000 OTHER INCOME 350,000 4,000.00 6,000.00 DIVIDEND INCOME 20,000 RENT INCOME TOTAL REVENUE AND INCOME (a) 576,400.00 3,000 25,000 COST OF SALES 15,000 3,000 INVENTORY, MAY 1 30,000.00 PURCHASES 350,000.00 1,000.00 (3,000.00) (20,000.00) (80,000.00) 300,000 7,000 ADD: FREIGHT IN LESS: PURCHASE DISCOUNT LESS: PURCHASE RETURN AND ALLOWANCES 3,000 LESS: INVENTORY, MAY 31 COST OF SALES (b) 1,200 40,000 30.000 278,000.00 OPERATING EXPENSES FREIGHT OUT SUPPLIES EXPENSE LOSS FROM SALE OF OFFICE BUILDING DEPRECIATION- STORE BUILDING DEPRECIATION- OFFICE BUILDING 2,000.00 5,000.00 3,000.00 20,000.00 15,000.00 1,500.00 2,000.00 7,000.00 800 Insurance- Office Building Insurance- Store Building Heat, Light and Power Rent Expense Bad Debts Depreciation- Store Building Depreciation- Office Building Cash Notes Receivable Accounts Receivable 4,000 6,000 1,400 2,000 1,500 20,000 BAD DEBTS RENT EXPENSES MISCELLANEOUS SELLING EXPENSES MISCELLANEOUS GENERAL EXPENSES POSTAGE AND TELEGRAPH SALES SALARIES 3,000.00 15,000 40,000 50.000 100,000 1,200.00 40,000.00 30,000.00 OFFICE SALARIES ADVERTISING EXPENSE 800.00 INSURANCE- OFFICE BUILDING 4,000.00 Allowance for Bad Debts 8,000 INSURANCE- STORAGE BUILDING HEAT, LIGHT AND POWER INTEREST EXPENSE TOTAL OPERATING EXPENSE (c) 6.000.00 Store Building 400,000 40,000 1,400.00 3,000.00 Accumulated Depreciation- Store Building Office Building Accumulated Depreciation- Office Building 600,000 144,900.00 NET PROFIT DURING THE MONTH 153,500.00 75,000 600,000 3,600 30,000 672,500 Sales Sales Discounts Sales Returns and Allowances Dada, Capital 6,000 3,000 Dada, Drawing Loss from Sale of Office Building
FUNCTIONAL PRESENTATION: Х СОMРANY Income Statement For the Period Ended December 31, 2020 Note Net Sales Revenue Less: Cost of Sales Р х (1) (2) хXX Р ххх Gross Profit from Sales Add: Other Income Total Revenues XXX ( 3 ) Р ххх Less: Operating Expenses Distribution Costs Administrative Expenses Other Operating Expenses (4) (5) (6) Pxxx XXX XXX , XXX P XXX Operating Income Less: Finance Cost (7) XXX Profit for the period ended Р ххх Note 1- Net Sales Revenue Sales Рххх Less: Sales Returns and Allowances Px Sales Discounts Net Sales Revenue XX, XXX Pxxx Note 2- Cost of Sales Inventory, January 1 Add: Net Purchases Purchases Рххх Р х P xX Add: Freight In Cost of Goods Delivered XX Р хх Less: Purchase Discounts Р х Purchase Returns and Allowances XX, XX, XXX Рххх Total Goods Available for Sale Less: Inventory, December 31 Cost of Sales XX Pxxx Рххх Note 3- Other Income Interest Income Pxx Rent Income XX Gain from Sale of Plant Assets XX Dividend Income XX Рххх Total Note 4- Distribution Costs: Advertising Expense Commission Expense Store Supplies Used Salesmen's Salaries Depreciation- Delivery Equipment Total Р х XX XX XX XX Pxx Note 5- Administrative Expenses: Bad Debts Rent Expense Insurance Expense Depreciation- Office Equipment Office Salaries Utilities Expense Total P xx XX XX XX XX XX Pxx Note 6- Other Operating Expenses: Loss from Sale of Plant Assets P xx, Note 7- Finance Cost Interest Expense P xx
Transcribed Image Text:FUNCTIONAL PRESENTATION: Х СОMРANY Income Statement For the Period Ended December 31, 2020 Note Net Sales Revenue Less: Cost of Sales Р х (1) (2) хXX Р ххх Gross Profit from Sales Add: Other Income Total Revenues XXX ( 3 ) Р ххх Less: Operating Expenses Distribution Costs Administrative Expenses Other Operating Expenses (4) (5) (6) Pxxx XXX XXX , XXX P XXX Operating Income Less: Finance Cost (7) XXX Profit for the period ended Р ххх Note 1- Net Sales Revenue Sales Рххх Less: Sales Returns and Allowances Px Sales Discounts Net Sales Revenue XX, XXX Pxxx Note 2- Cost of Sales Inventory, January 1 Add: Net Purchases Purchases Рххх Р х P xX Add: Freight In Cost of Goods Delivered XX Р хх Less: Purchase Discounts Р х Purchase Returns and Allowances XX, XX, XXX Рххх Total Goods Available for Sale Less: Inventory, December 31 Cost of Sales XX Pxxx Рххх Note 3- Other Income Interest Income Pxx Rent Income XX Gain from Sale of Plant Assets XX Dividend Income XX Рххх Total Note 4- Distribution Costs: Advertising Expense Commission Expense Store Supplies Used Salesmen's Salaries Depreciation- Delivery Equipment Total Р х XX XX XX XX Pxx Note 5- Administrative Expenses: Bad Debts Rent Expense Insurance Expense Depreciation- Office Equipment Office Salaries Utilities Expense Total P xx XX XX XX XX XX Pxx Note 6- Other Operating Expenses: Loss from Sale of Plant Assets P xx, Note 7- Finance Cost Interest Expense P xx
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