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What is Avett, Inc.'s 2020 Depreciation Expense?   Question 12 options:   $100   $175   $150   $200

What is Avett, Inc.'s 2020 Depreciation Expense?   Question 12 options:   $100   $175   $150   $200

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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What is Avett, Inc.'s 2020 Depreciation Expense?

 

Question 12 options:

 

$100
 

$175
 

$150
 

$200

 

CONSOLIDATED BALANCE SHEET (in millions) Year Ending Dec. 31 2020 2019 ASSETS Cash and Cash Equivalents $1,000 $800 Accounts Receivable 300 500 Merchandise Inventory 880 650 Short Term Investments 145 120 TOTAL CURRENT ASSETS 2,325 2,070 PP&E, net accumulated depreciation of $600 in 2020 and $500 in 2019 1,250 1,000 TOTAL ASSETS $3,575 $3,070 LIABILITIES Accounts Payable Other Payables $530 $500 410 362 TOTAL CURRENT LIABILITIES 940 862 Mortgage Payable Long-Term Bank Loan 700 900 850 TOTAL LIABILITIES 1,840 2,412 OWNERS EQUITY Common Stock 80 70 Preferred Stock Additional Paid in Capital Retained Earnings TOTAL OWNERS EQUITY 290 250 1,365 1,735 338 658 TOTAL LIABILITIES + OWNERS EQUITY $3,575 $3,070
Transcribed Image Text:CONSOLIDATED BALANCE SHEET (in millions) Year Ending Dec. 31 2020 2019 ASSETS Cash and Cash Equivalents $1,000 $800 Accounts Receivable 300 500 Merchandise Inventory 880 650 Short Term Investments 145 120 TOTAL CURRENT ASSETS 2,325 2,070 PP&E, net accumulated depreciation of $600 in 2020 and $500 in 2019 1,250 1,000 TOTAL ASSETS $3,575 $3,070 LIABILITIES Accounts Payable Other Payables $530 $500 410 362 TOTAL CURRENT LIABILITIES 940 862 Mortgage Payable Long-Term Bank Loan 700 900 850 TOTAL LIABILITIES 1,840 2,412 OWNERS EQUITY Common Stock 80 70 Preferred Stock Additional Paid in Capital Retained Earnings TOTAL OWNERS EQUITY 290 250 1,365 1,735 338 658 TOTAL LIABILITIES + OWNERS EQUITY $3,575 $3,070
CONSOLIDATED INCOME STATEMENT (in millions) December 31, 2020 $20,000 (10,000) (10,000) (8,000) 2,000 (500) $1,500 Revenues Cost of Goods Sold Profit Margin SG&A Pre-Tax Income Тах Expense Net Income Additional Information > No Property, Plant & Equipment (PPE) was sold during 2020. > No short-term investments were sold during the year. > All depreciation expense is included in SG&A > Because there is no dividends payable account at either the start of end of the year, you may assume all dividends declared in 2020 were paid in 2020. Тo Do > Complete the 2020 Cash Flow Statement on the following page. Note: You may use the worksheet provided on the last page to help you prepare the Cash Flow Statement. Hint #1 PPE: Remember to evaluate changes in gross PPE separate from changes in accumulated depreciation. Recall gross PPE less accumulated depreciation equals net PPE. Hint #2 Stock Issuance: Remember the total change in cash due to stock issuances/repurchases is the sum of the change in common stock (stated par value) and additional paid in capital (APIC).
Transcribed Image Text:CONSOLIDATED INCOME STATEMENT (in millions) December 31, 2020 $20,000 (10,000) (10,000) (8,000) 2,000 (500) $1,500 Revenues Cost of Goods Sold Profit Margin SG&A Pre-Tax Income Тах Expense Net Income Additional Information > No Property, Plant & Equipment (PPE) was sold during 2020. > No short-term investments were sold during the year. > All depreciation expense is included in SG&A > Because there is no dividends payable account at either the start of end of the year, you may assume all dividends declared in 2020 were paid in 2020. Тo Do > Complete the 2020 Cash Flow Statement on the following page. Note: You may use the worksheet provided on the last page to help you prepare the Cash Flow Statement. Hint #1 PPE: Remember to evaluate changes in gross PPE separate from changes in accumulated depreciation. Recall gross PPE less accumulated depreciation equals net PPE. Hint #2 Stock Issuance: Remember the total change in cash due to stock issuances/repurchases is the sum of the change in common stock (stated par value) and additional paid in capital (APIC).
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