The draft adjusted trial balance of Alberta Enterprises Ltd., a publicly quoted company, at December 31, 2021, is as follows: Debits Credits $ $ Cash 410,000 Accounts receivable 1,030,000 Allowance for expected credit losses 17,000 Inventory 1,374,000 Buildings 2,080,000 Accumulated depreciation—buildings 304,000 Investments 1,000,000 Bonds payable (due in three years) 1,200,000 Accounts payable 290,000 Dividends payable 72,000 Income tax payable 192,000 Common shares 600,000 Retained earnings balance 1 January 2021 509,000 Accumulated other comprehensive income 1 January 2021 370,000 Sales revenue 17,870,000 Cost of goods sold 9,518,000 Selling & Administrative expenses 5,520,000 Interest expense 422,000 Gain on disposal of land 120,000 Dividends declared 190,000 Totals 21,544,000 21,544,000 Notes: 1. Depreciation for 2021 has already been recorded and included in Selling & Administrative expenses. 2. Cash includes prepaid insurance of $9,000, and a bank overdraft of $10,000 has been deducted. 3. Inventory does not include goods costing $10,000 shipped out on consignment. Receivables of $10,000 were recorded on these goods. 4. Investments include: a. Investments in common shares treated as FV-NI $306,000 (at cost), market value at December 31, 2021 $325,000 b. Long-term investments treated as FV-OCI $554,000 (at cost), market value at December 31, 2021 $540,000 c. Franchises of $140,000 purchased on December 31, 2021. Required and Additional information: (a) Calculate the Net Income for the year ended based on the trial balance above and the additional information provided in the notes above. (No need to prepare a proper income statement, just the net income calculation) (b) Prepare a classified Statement of Financial Position as of December 31, 2021
The draft adjusted
|
Debits |
Credits |
||||||
|
$ |
$ |
||||||
|
Cash |
410,000 |
||||||
|
|
1,030,000 |
||||||
|
Allowance for expected credit losses |
|
|
|
|
17,000 |
||
|
Inventory |
1,374,000 |
||||||
|
Buildings |
2,080,000 |
||||||
|
|
304,000 |
||||||
|
Investments |
|
|
1,000,000 |
|
|
||
|
Bonds payable (due in three years) |
1,200,000 |
||||||
|
Accounts payable |
290,000 |
||||||
|
Dividends payable |
72,000 |
||||||
|
Income tax payable |
192,000 |
||||||
|
Common shares |
600,000 |
||||||
|
|
509,000 |
||||||
|
Accumulated other comprehensive income 1 January 2021 |
370,000 |
||||||
|
Sales revenue |
17,870,000 |
||||||
|
Cost of goods sold |
9,518,000 |
||||||
|
Selling & Administrative expenses |
5,520,000 |
||||||
|
Interest expense |
422,000 |
||||||
|
Gain on disposal of land |
120,000 |
||||||
|
Dividends declared |
190,000 |
||||||
|
Totals |
21,544,000 |
21,544,000 |
Notes:
1. Depreciation for 2021 has already been recorded and included in Selling & Administrative expenses.
2. Cash includes prepaid insurance of $9,000, and a bank overdraft of $10,000 has been deducted.
3. Inventory does not include goods costing $10,000 shipped out on consignment. Receivables of $10,000 were recorded on these goods.
4. Investments include:
a. Investments in common shares treated as FV-NI $306,000 (at cost), market value at December 31, 2021 $325,000
b. Long-term investments treated as FV-OCI $554,000 (at cost), market value at December 31, 2021 $540,000
c. Franchises of $140,000 purchased on December 31, 2021.
Required and Additional information:
(a) Calculate the Net Income for the year ended based on the trial balance above and the additional information provided in the notes above. (No need to prepare a proper income statement, just the net income calculation)
(b) Prepare a classified
Step by step
Solved in 4 steps with 3 images
