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The following transactions apply to Ozark Sales for Year 1: The business was started when the company received $48,000 from the issue of common stock. Purchased equipment inventory of $175,000 on account. Sold equipment for $191,000 cash (not including sales tax). Sales tax of 7 percent is collected when the merchandise is sold. The merchandise had a cost of $116,000. Provided a six-month warranty on the equipment sold. Based on industry estimates, the warranty claims would amount to 4 percent of sales. Paid the sales tax to the state agency on $141,000 of the sales. On September 1, Year 1, borrowed $21,000 from the local bank. The note had a 7 percent interest rate and matured on March 1, Year 2. Paid $5,900 for warranty repairs during the year. Paid operating expenses of $52,000 for the year. Paid $124,900 of accounts payable. Recorded accrued interest on the note issued in transaction no. 6. Exercise 9-8A (Algo) Part b b-2. Prepare the balance sheet for Year 1. Note: Round your answers to the nearest dollar amount.

The following transactions apply to Ozark Sales for Year 1: The business was started when the company received $48,000 from the issue of common stock. Purchased equipment inventory of $175,000 on account. Sold equipment for $191,000 cash (not including sales tax). Sales tax of 7 percent is collected when the merchandise is sold. The merchandise had a cost of $116,000. Provided a six-month warranty on the equipment sold. Based on industry estimates, the warranty claims would amount to 4 percent of sales. Paid the sales tax to the state agency on $141,000 of the sales. On September 1, Year 1, borrowed $21,000 from the local bank. The note had a 7 percent interest rate and matured on March 1, Year 2. Paid $5,900 for warranty repairs during the year. Paid operating expenses of $52,000 for the year. Paid $124,900 of accounts payable. Recorded accrued interest on the note issued in transaction no. 6. Exercise 9-8A (Algo) Part b b-2. Prepare the balance sheet for Year 1. Note: Round your answers to the nearest dollar amount.

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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The following transactions apply to Ozark Sales for Year 1: The business was started when the company received $48,000 from the issue of common stock. Purchased equipment inventory of $175,000 on account. Sold equipment for $191,000 cash (not including sales tax). Sales tax of 7 percent is collected when the merchandise is sold. The merchandise had a cost of $116,000. Provided a six-month warranty on the equipment sold. Based on industry estimates, the warranty claims would amount to 4 percent of sales. Paid the sales tax to the state agency on $141,000 of the sales. On September 1, Year 1, borrowed $21,000 from the local bank. The note had a 7 percent interest rate and matured on March 1, Year 2. Paid $5,900 for warranty repairs during the year. Paid operating expenses of $52,000 for the year. Paid $124,900 of accounts payable. Recorded accrued interest on the note issued in transaction no. 6. Exercise 9-8A (Algo) Part b b-2. Prepare the balance sheet for Year 1. Note: Round your answers to the nearest dollar amount.
Transcribed Image Text:The following transactions apply to Ozark Sales for Year 1: The business was started when the company received $48,000 from the issue of common stock. Purchased equipment inventory of $175,000 on account. Sold equipment for $191,000 cash (not including sales tax). Sales tax of 7 percent is collected when the merchandise is sold. The merchandise had a cost of $116,000. Provided a six-month warranty on the equipment sold. Based on industry estimates, the warranty claims would amount to 4 percent of sales. Paid the sales tax to the state agency on $141,000 of the sales. On September 1, Year 1, borrowed $21,000 from the local bank. The note had a 7 percent interest rate and matured on March 1, Year 2. Paid $5,900 for warranty repairs during the year. Paid operating expenses of $52,000 for the year. Paid $124,900 of accounts payable. Recorded accrued interest on the note issued in transaction no. 6. Exercise 9-8A (Algo) Part b b-2. Prepare the balance sheet for Year 1. Note: Round your answers to the nearest dollar amount.
b-2. Prepare the balance sheet for Year 1. Note: Round your answers to the nearest dollar amount. OZARK SALES Balance Sheet As of December 31, Year 1 Assets Cash Merchandise inventory Total assets Liabilities Accounts payable Sales tax payable Notes payable Warranty payable Interest payable Total liabilities Stockholders' equity Common stock Retained earnings Total stockholders' equity Total liabilities and stockholders' equity OZARK SALES Statement of Cash Flows For the Year Ended December 31, Year 1 Cash flows from operating activities: Inflow from customers Inflow from sales tax Outflow for expenses Outflow for sales tax Outflow to purchase inventory Net cash flows from operating activities Cash flows from investing activities: Cash flows from financing activities Inflow from loan Inflow from stock issue $0 b-3. Prepare the statement of cash flows for Year 1. Note: Enter amounts to be deducted and cash outflows with a minus sign. Round your answers to the nearest whole dollar. Net cash flows from financing activities Net change in cash Plus: Beginning cash balance Ending cash balance. 0 0 $0 $0 0 0 $0
Transcribed Image Text:b-2. Prepare the balance sheet for Year 1. Note: Round your answers to the nearest dollar amount. OZARK SALES Balance Sheet As of December 31, Year 1 Assets Cash Merchandise inventory Total assets Liabilities Accounts payable Sales tax payable Notes payable Warranty payable Interest payable Total liabilities Stockholders' equity Common stock Retained earnings Total stockholders' equity Total liabilities and stockholders' equity OZARK SALES Statement of Cash Flows For the Year Ended December 31, Year 1 Cash flows from operating activities: Inflow from customers Inflow from sales tax Outflow for expenses Outflow for sales tax Outflow to purchase inventory Net cash flows from operating activities Cash flows from investing activities: Cash flows from financing activities Inflow from loan Inflow from stock issue $0 b-3. Prepare the statement of cash flows for Year 1. Note: Enter amounts to be deducted and cash outflows with a minus sign. Round your answers to the nearest whole dollar. Net cash flows from financing activities Net change in cash Plus: Beginning cash balance Ending cash balance. 0 0 $0 $0 0 0 $0
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