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[The following information applies to the questions displayed below.] Forten Company's current year Income statement, comparative balance sheets, and additional Information follow. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of Inventory are on credit, and (4) all debits to Accounts Payable reflect cash payments for Inventory. Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income Assets Cash FORTEN COMPANY Income Statement For Current Year Ended December 31 Accounts receivable Inventory Prepaid expenses Total current assets Long-term notes payable Total liabilities FORTEN COMPANY Comparative Balance Sheets December 31 Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable Equity Common stock, $5 par value Paid-in capital in excess of par, common stock Retained earnings Total liabilities and equity $ 132,400 20,750 $ 582,500 285,000 297,500 153,150 (5, 125) 139, 225 24,250 $ 114,975 Current Year Prior Year $ 49,800 65,810 275,656 1,250 392,516 157,500 (36,625) $513,391 $ 53,141 75,000 128,141 $ 73,500 50,625 251,800 1,875 377,800 108,000 (46,000) $ 439,800 $ 114,675 54,750 169,425 150, 250 0 162,750 37,500 185,000 120, $ 513,391 $ 439,800 ditional Information on Current Year Transactions The loss on the cash sale of equipment was $5,125 (detalls in b). Sold equipment costing $46,875, with accumulated depreciation of $30,125, for $11,625 cash. Purchased equipment costing $96,375 by paying $30.000 cash and signing a long-term notes payable for the balar Pald $46,125 cash to reduce the long-term notes payable. Issued 2,500 shares of common stock for $20 cash per share. Declared and paid cash dividends of $50100

[The following information applies to the questions displayed below.] Forten Company's current year Income statement, comparative balance sheets, and additional Information follow. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of Inventory are on credit, and (4) all debits to Accounts Payable reflect cash payments for Inventory. Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income Assets Cash FORTEN COMPANY Income Statement For Current Year Ended December 31 Accounts receivable Inventory Prepaid expenses Total current assets Long-term notes payable Total liabilities FORTEN COMPANY Comparative Balance Sheets December 31 Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable Equity Common stock, $5 par value Paid-in capital in excess of par, common stock Retained earnings Total liabilities and equity $ 132,400 20,750 $ 582,500 285,000 297,500 153,150 (5, 125) 139, 225 24,250 $ 114,975 Current Year Prior Year $ 49,800 65,810 275,656 1,250 392,516 157,500 (36,625) $513,391 $ 53,141 75,000 128,141 $ 73,500 50,625 251,800 1,875 377,800 108,000 (46,000) $ 439,800 $ 114,675 54,750 169,425 150, 250 0 162,750 37,500 185,000 120, $ 513,391 $ 439,800 ditional Information on Current Year Transactions The loss on the cash sale of equipment was $5,125 (detalls in b). Sold equipment costing $46,875, with accumulated depreciation of $30,125, for $11,625 cash. Purchased equipment costing $96,375 by paying $30.000 cash and signing a long-term notes payable for the balar Pald $46,125 cash to reduce the long-term notes payable. Issued 2,500 shares of common stock for $20 cash per share. Declared and paid cash dividends of $50100

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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Required information [The following information applies to the questions displayed below.] Forten Company's current year Income statement, comparative balance sheets, and additional Information follow. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of Inventory are on credit, and (4) all debits to Accounts Payable reflect cash payments for Inventory. Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income Assets Cash Accounts receivable Inventory FORTEN COMPANY Income Statement For Current Year Ended December 31 Prepaid expenses Total current assets FORTEN COMPANY Comparative Balance Sheets December 31 Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable Long-term notes payable Total liabilities Equity Common stock, $5 par value Paid-in capital in excess of par, common stock Retained earnings Total liabilities and equity $ 132,400 20, 750 $ 582,500 285,000 297,500 153,150 (5,125) 139, 225 24, 250 $ 114,975 Current Year $ 49,800 65,810 275,656 1,250 392,516 157,500 (36,625) $ 513,391 $53,141 75,000 128,141 162,750 37,500 185,000 $ 513,391 Prior Year $ 73,500 50, 625 251,800 1,875 377,800 108,000 (46,000) $ 439,800 $ 114,675 54,750 169,425 150, 250 0 120, 125 $ 439,800 Additional Information on Current Year Transactions a. The loss on the cash sale of equipment was $5,125 (detalls in b). b. Sold equipment costing $46,875, with accumulated depreciation of $30,125, for $11,625 cash. c. Purchased equipment costing $96,375 by paying $30.000 cash and signing a long-term notes payable for the balance. d. Pald $46,125 cash to reduce the long-term notes payable. e. Issued 2,500 shares of common stock for $20 cash per share. 1. Declared and paid cash dividends of $50,100.
Transcribed Image Text:Required information [The following information applies to the questions displayed below.] Forten Company's current year Income statement, comparative balance sheets, and additional Information follow. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of Inventory are on credit, and (4) all debits to Accounts Payable reflect cash payments for Inventory. Sales Cost of goods sold Gross profit Operating expenses (excluding depreciation) Depreciation expense other gains (losses) Loss on sale of equipment Income before taxes Income taxes expense Net income Assets Cash Accounts receivable Inventory FORTEN COMPANY Income Statement For Current Year Ended December 31 Prepaid expenses Total current assets FORTEN COMPANY Comparative Balance Sheets December 31 Equipment Accumulated depreciation-Equipment Total assets Liabilities and Equity Accounts payable Long-term notes payable Total liabilities Equity Common stock, $5 par value Paid-in capital in excess of par, common stock Retained earnings Total liabilities and equity $ 132,400 20, 750 $ 582,500 285,000 297,500 153,150 (5,125) 139, 225 24, 250 $ 114,975 Current Year $ 49,800 65,810 275,656 1,250 392,516 157,500 (36,625) $ 513,391 $53,141 75,000 128,141 162,750 37,500 185,000 $ 513,391 Prior Year $ 73,500 50, 625 251,800 1,875 377,800 108,000 (46,000) $ 439,800 $ 114,675 54,750 169,425 150, 250 0 120, 125 $ 439,800 Additional Information on Current Year Transactions a. The loss on the cash sale of equipment was $5,125 (detalls in b). b. Sold equipment costing $46,875, with accumulated depreciation of $30,125, for $11,625 cash. c. Purchased equipment costing $96,375 by paying $30.000 cash and signing a long-term notes payable for the balance. d. Pald $46,125 cash to reduce the long-term notes payable. e. Issued 2,500 shares of common stock for $20 cash per share. 1. Declared and paid cash dividends of $50,100.
Balance sheet-debit Cash Accounts receivable Inventory Prepaid expenses Equipment Balance sheet-credit Accumulated depreciation Equipment Accounts payable Long-term notes payable Common stock, $5 par value Paid in capital in excess of par value, common stock Retained earnings Statement of cash flows Operating activities Depreciation expense Loss on sale of equipment Decrease in prepaid expenses Investing activities Loss on sale of equipment Payment to purchase equipment sprentahout for slebevel of cini FAME Financing activities Payment of cash dividends Payment on long lean noves Issued common stock for cash Non cash investing and financing activities. Purchase of equem anced by the term notes parede ✔ 10 ✔ 000 IS $ PINK YOU 73,500 50,625 251,800 1,875 108,000 485,800 46,000 114,675 54,750 150,250 0 120,125 485,800 S 15,185 23,856 96,375 30,125 61,534 46,125 50,100 114,975 5,125 625 12.500 23.700 € 5 Copert 23,700 S 625 46,875 66,375 12,500✔ 37,500 114,975 20,750 S 15,185 23.856 DECNINE 30 Current Year 50.1002 $ 550,100 3 IS 49,800 65,810 275,856 1,250 157,500 550,018 36,625 53,141 75,000 162,750 550.018
Transcribed Image Text:Balance sheet-debit Cash Accounts receivable Inventory Prepaid expenses Equipment Balance sheet-credit Accumulated depreciation Equipment Accounts payable Long-term notes payable Common stock, $5 par value Paid in capital in excess of par value, common stock Retained earnings Statement of cash flows Operating activities Depreciation expense Loss on sale of equipment Decrease in prepaid expenses Investing activities Loss on sale of equipment Payment to purchase equipment sprentahout for slebevel of cini FAME Financing activities Payment of cash dividends Payment on long lean noves Issued common stock for cash Non cash investing and financing activities. Purchase of equem anced by the term notes parede ✔ 10 ✔ 000 IS $ PINK YOU 73,500 50,625 251,800 1,875 108,000 485,800 46,000 114,675 54,750 150,250 0 120,125 485,800 S 15,185 23,856 96,375 30,125 61,534 46,125 50,100 114,975 5,125 625 12.500 23.700 € 5 Copert 23,700 S 625 46,875 66,375 12,500✔ 37,500 114,975 20,750 S 15,185 23.856 DECNINE 30 Current Year 50.1002 $ 550,100 3 IS 49,800 65,810 275,856 1,250 157,500 550,018 36,625 53,141 75,000 162,750 550.018
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