Selected information taken from the financial statements of Fordstar Co. for the year ended December 31, 2019, follows: Net cash provided by operations Cost of goods sold $27,000 $117,900 Selling, general, and administrative expenses $40,500 Accounts payable $32,400 Dividends paid $56,700 Research and development expenses $24,300 Merchandise inventory $39,600 Provision for income taxes $15,300 Net sales $330,300 $36,900 Interest expense Required: a. Calculate income from operations (operating income) for the year ended December 31, 2019. b. Calculate net income for the year ended December 31, 2019.

Selected information taken from the financial statements of Fordstar Co. for the year ended December 31, 2019, follows: Net cash provided by operations Cost of goods sold $27,000 $117,900 Selling, general, and administrative expenses $40,500 Accounts payable $32,400 Dividends paid $56,700 Research and development expenses $24,300 Merchandise inventory $39,600 Provision for income taxes $15,300 Net sales $330,300 $36,900 Interest expense Required: a. Calculate income from operations (operating income) for the year ended December 31, 2019. b. Calculate net income for the year ended December 31, 2019.

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

Chapter22: Accounting For Changes And Errors.

Section: Chapter Questions

Problem 4RE: Refer to RE22-2. Assume Heller Company had sales revenue of 510,000 in 2019 and 650,000 in 2020....

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Refer to RE22-2. Assume Heller Company had sales revenue of 510,000 in 2019 and 650,000 in 2020. Prepare Hellers partial income statements (through gross profit) for 2019 and 2020. RE22-2 Heller Company began operations in 2019 and used the LIFO method to compute its 300,000 cost of goods sold for that year. At the beginning of 2020, Heller changed to the FIFO method. Heller determined that its cost of goods sold under FIFO would have been 250,000 in 2019. For 2020, Hellers cost of goods sold under FIFO was 360,000, while it would have been 410,000 under LIFO. Heller is subject to a 21% income tax rate. Compute the cumulative effect of the retrospective adjustment on prior years income (net of taxes) that Heller would report on its retained earnings statement for 2020.
Cost of Goods Sold, Income Statement. and Statement of Comprehensive Income Gaskin Company derives the following items from its adjusted trial balance as of December 31, 2019: The following; additional information is also available. The December 31, 2019, ending inventory is 14,700. During 2019, 4,200 shares of'common stock were outstanding the entire year. The income tax rate 30% on all items of income. Required: 1. As a supporting document for Requirements 2 and 3, prepare a separate schedule for Gaskins cost of goods sold. 2. Prepare a 2019 single-step income statement. 3. Prepare a 2019 multiple-step income statement. 4. Prepare a 2019 statement of comprehensive income.
Cost of goods sold and related items The following data were extracted from the accounting records of Harkins Company for the year ended April 30, 20Y8: Estimated returns of current year sales 11,600 Inventory, May 1, 20Y7 380,000 Inventory, April 30, 20Y8 415,000 Purchases 3,800,000 Purchases returns and allowances 150,000 Purchases discounts 80,000 Sales 5,850,000 Freight in 16,600 a. Prepare the Cost of goods sold section of the income statement for the year ended April 30, 20Y8, using the periodic inventory system. b. Determine the gross profit to be reported on the income statement for the year ended April 30, 20Y8. c. Would gross profit be different if the perpetual inventory system was used instead of the periodic inventory system?
The 2021 income statement of Adrian Express reports sales of $14,097,000, cost of goods sold of $8,154,000, and net income of $1,540,000. Balance sheet information is provided in the following table. ADRIAN EXPRESSBalance SheetsDecember 31, 2021 and 2020 2021 2020 Assets Current assets: Cash $ 540,000 $ 700,000 Accounts receivable 1,280,000 940,000 Inventory 1,680,000 1,340,000 Long-term assets 4,740,000 4,180,000 Total assets $ 8,240,000 $ 7,160,000 Liabilities and Stockholders' Equity Current liabilities $ 1,960,000 $ 1,600,000 Long-term liabilities 2,240,000 2,340,000 Common stock 1,880,000 1,880,000 Retained earnings 2,160,000 1,340,000 Total liabilities and stockholders' equity $ 8,240,000 $ 7,160,000 Industry averages for the following four risk ratios are as follows:…
Use the information above to calculate cash flows from operating activities using the indirect method. Note: Amounts to be deducted should be indicated by a minus sign. Cash flows from operating activities Net income Adjustments to reconcile net income to net cash provided by operating activities Income statement items not affecting cash Changes in current operating assets and liabilities $ 42,000 S 42.000 42.000
The 2021 Income statement of Adrian Express reports sales of $16,932,000, cost of goods sold of $10,363,500, and net income of $1,630,000. Balance sheet information is provided in the following table. ADRIAN EXPRESS Balance Sheets December 31, 2021 and 2020 2021 2020 Assets Current assets: $ 630,000 $ 790,000 Cash Accounts receivable Inventory 1,460,000 1,860,000 4,830,000 $8,780,000 $7,520,000 1,030,000 1,430,000 4, 270,000 Long-term assets Total assets Liabilities and Stockholders' Equity Current liabilities Long-term liabilities $1,990,000 $1,690,000 2,330,000 1,970,000 2,490,000 2,430,000 1,970, 000 1,430,000 Common stock Retained earnings Total liabilities and stockholders' equity $8,780,000 $7,520,000 Industry averages for the following four risk ratios are as follows: Average collection period Average days in inventory Current ratio Debt to equity ratio 25 days 60 days 2 to 1 50% Requlred: 1. Calculate the four risk ratios listed above for Adrian Express in 2021. (Use 365 days…
Sales MOSS COMPANY Income Statement For Year Ended December 31, 2021 Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense Income before taxes Income taxes expense Net income $ 549,000 357,600 191,400 128,500 49,000 13,900 8,100 $ 5,800 MOSS COMPANY Selected Balance Sheet Information At December 31 2021 2020 Current assets Cash $ 91,150 $ 33,300 Accounts receivable 31,500 45,000 66,500 55,400 Current liabilities 43,400 32,200 2,700 3,500 Inventory Accounts payable Income taxes payable Use the information above to calculate cash flows from operating activities using the indirect method. Note: Amounts to be deducted should be indicated by a minus sign. Cash flows from operating activities: Adjustments to reconcile net income to net cash provided by operating activities Income statement items not affecting cash Changes in current operating assets and liabilities $ 49,000 49,000 $ 49,000
MOSS COMPANY Income Statement For Year Ended December 31, 2021 Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense Income before taxes Income taxes expense Net income MOSS COMPANY Selected Balance Sheet Information 2021 At December 31 Current assets Cash Accounts receivable Inventory Current liabilities Accounts payable Income taxes payable $91,150 31,500 66,500 Cash flows from operating activities: 43,400 2,700 $ 549,000 357,600 191,400 128,500 49,000 13,900 8,100 $ 5,800 2028 $ 33,300 45,000 55,400 32,200 3,500 Use the information above to calculate cash flows from operating activities using the indirect method. Note: Amounts to be deducted should be indicated by a minus sign. Adjustments to recor net come to net cash provided by operating activities Income statement items not affecting cash Changes in current operating assets and liabilities $ 49.000 $ 49,000 49,000
MOSS COMPANY Income Statement For Year Ended December 31, 2021 Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense Income before taxes Income taxes expense Net income MOSS COMPANY Selected Balance Sheet Information 2021 At December 31 Current assets Cash Accounts receivable Inventory Current liabilities Accounts payable Income taxes payable $ 86,150 26,500 61,500 Cash flows from operating activities: 33,400 2,200 2020 $530,000 337,600 192,400 123,500 39,000 Changes in current operating assets and liabilities 29,900 9,900 $ 20,000 $ 28,300 35,000 54,400 Use the information above to calculate cash flows from operating activities using the indirect method. Note: Amounts to be deducted should be indicated by a minus sign. 27,200 2,500 Adjustments to reconcile net income to net cash provided by operating activities Income statement items not affecting cash $ 39,000
Given the following financial data for XYZ, Inc.: • Inventory on December 31, 2020: $5,000 • Inventory on December 31, 2021: $3,000 • Accounts payable on December 31, 2020: $12,000 Accounts payable on December 31, 2021: $15,000 . Cost of goods sold for the year 2021: $50,000 The net cash paid to suppliers of inventory during the year 2021 is: 1) $49,000 2) $55,000 3) $45,000 4) $51,000 5) None of the above.
Income statement and balance sheet information abstracted from a recent annual report of Wolverine World Wide, Incorporated, appears below: Balance Sheets ($ in millions) December 28, 2019 Current assets: Inventories Net sales Cost of goods sold Gross profit $ 348.2 December 29, 2018 $317.6 Income Statements ($ in millions) For the Year Ended December 28, 2019 $2,273.7 1,349.9 $923.8 December 29, 2018 $ 2,239.2 1,317.9 $921.3 The significant accounting policies note disclosure contained the following: Inventories The Company used the LIFO method to value inventories of $81.2 million and $61.1 million at December 28, 2019, and December 29, 2018, respectively. During fiscal years 2019 and 2018, a reduction in inventory quantities resulted in a liquidation of applicable LIFO inventory quantities carried at lower costs in prior years. This LIFO liquidation decreased cost of goods sold by $0.4 million and $4.6 million, respectively. If the FIFO method had been used, inventories would have…
Presented below is the condensed financial statements of Williams Enterprise Ltd. forthe year ended December 31, 2019.Consolidated Statement of EarningsFor the years ended December 31, 2019 and December 31, 2018 2019 2018($ millions except where otherwise indicated)Sales $ 30,997 $ 30,735Cost of Merchandise Inventories Sold (note 9) 23,393 23,539Gross Profit 7,604 7,196Operating ExpensesSelling and administrative expenses 5,680 5,402Depreciation and amortization 655 5896,335 5,991Operating Income 1,269 1,205Interest expense and other financing charges (note 4) 273 269Earnings Before Income Taxes and Minority Interest 996 936Income Taxes (note 5) 297 269Net Earnings Before Minority Interest 699 667Minority Interest 18 11Net Earnings $ 681 $ 656Net Earnings Per Common Share ($) (note 6)Basic $ 2.45 $ 2.39Diluted $ 2.44 $ 2.38 Consolidated Statement of Financial PositionAs at December 31, 2019 and December 31, 2018($ millions) 2019 2018AssetsCurrent AssetsCash and cash equivalents (note…