The following transactions apply to Ozark Sales for Year 1: The business was started when the company received $50,000 from the issue of common stock.Purchased equipment inventory of $178,000 on account.Sold equipment for $192,000 cash (not including sales tax). Sales tax of 6 percent is collected when the merchandise is sold. The merchandise had a cost of $117,000.Provided a six-month warranty on the equipment sold. Based on industry estimates, the warranty claims would amount to 5 percent of sales.Paid the sales tax to the state agency on $142,000 of the sales.On September 1, Year 1, borrowed $21,500 from the local bank. The note had a 6 percent interest rate and matured on March 1, Year 2.Paid $5,900 for warranty repairs during the year.Paid operating expenses of $56,000 for the year.Paid $124,000 of accounts payable.Recorded accrued interest on the note issued in transaction no. 6. RequiredRecord the given transactions in a horizontal statements model.Prepare the income statement, balance sheet, and statement of cash flows for Year 1.What is the total amount of current liabilities at December 31, Year 1? Complete this question by entering your answers in the tabs below.Req AEventNo.12.3a.3b.4.5.6.7.8.9.10.Bal.Req B Inc.StmtRecord the given transactions in a horizontal statements model. (Enter any decreases to account balances and cash outflows with a minus sign. In the Cash Flow column, indicate whether the item is an operating activity (OA), an investinga financing activity (FA), and leave the cell blank if there is no effect. Do not round intermediate calculations and round your answers to the nearest whole dollar amounts. Not all cells will require entry.)CashAssets+++++++++++Reg B BalSheet+Req B StmtCash Flows.Merchandise AccountsInventoryPayable=+++++++1+Reg CSales TaxPayableBalance SheetLiabilitiesWarrantyPayable++++++++++++++++++++++++OZARK SALESHorizontal Statements ModelInterestPayable++++++++++NotesPayable++++++1+++++++Stockholders' EquityCommonStock+++++< Req ARetained RevenueEarningsIncome StatementExpenseReq B Inc Stmt >=NetIncomeStatement of CashFlows

The financial statements are prepared at year end to present the true and fair picture. The term…

Answered: The following transactions apply to…

Quickbooks Online Accounting

3rd Edition

ISBN:9780357391693

Author:Owen

Publisher:Owen

Chapter10: Financial Statements And Reports

Section: Chapter Questions

Problem 1.6C

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Question

The following transactions apply to Ozark Sales for Year 1:

The business was started when the company received $50,000 from the issue of common stock.
Purchased equipment inventory of $178,000 on account.
Sold equipment for $192,000 cash (not including sales tax). Sales tax of 6 percent is collected when the merchandise is sold. The merchandise had a cost of $117,000.
Provided a six-month warranty on the equipment sold. Based on industry estimates, the warranty claims would amount to 5 percent of sales.
Paid the sales tax to the state agency on $142,000 of the sales.
On September 1, Year 1, borrowed $21,500 from the local bank. The note had a 6 percent interest rate and matured on March 1, Year 2.
Paid $5,900 for warranty repairs during the year.
Paid operating expenses of $56,000 for the year.
Paid $124,000 of accounts payable.
Recorded accrued interest on the note issued in transaction no. 6.

Required

Record the given transactions in a horizontal statements model.
Prepare the income statement, balance sheet, and statement of cash flows for Year 1.
What is the total amount of current liabilities at December 31, Year 1?

Complete this question by entering your answers in the tabs below.
Req A
Event
No.
1
2.
3a.
3b.
4.
5.
6.
7.
8.
9.
10.
Bal.
Req B Inc.
Stmt
Record the given transactions in a horizontal statements model. (Enter any decreases to account balances and cash outflows with a minus sign. In the Cash Flow column, indicate whether the item is an operating activity (OA), an investing
a financing activity (FA), and leave the cell blank if there is no effect. Do not round intermediate calculations and round your answers to the nearest whole dollar amounts. Not all cells will require entry.)
Cash
Assets
+
+
+
+
+
+
+
+
+
+
+
Reg B Bal
Sheet
+
Req B Stmt
Cash Flows.
Merchandise Accounts
Inventory
Payable
=
+
+
+
+
+
+
+1
+
Reg C
Sales Tax
Payable
Balance Sheet
Liabilities
Warranty
Payable
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
+
OZARK SALES
Horizontal Statements Model
Interest
Payable
+
+
+
+
+
+
+
+
+
+
Notes
Payable
+
+
+
+
+
+1
+
+
+
+
+
+
+
Stockholders' Equity
Common
Stock
+
+
+
+
+
< Req A
Retained Revenue
Earnings
Income Statement
Expense
Req B Inc Stmt >
=
Net
Income
Statement of Cash
Flows

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