What is the journal entry Declan's Designs recorded to recognize the purchase of PPE in 2022? Question 6 options: Dr. PPE $10,0000 Cr. Cash $10,000 Dr. PPE $22,0000 Cr. Cash $22,000 Dr. PPE $12,0000 Cr. Cash $12,000 Dr. PPE $11,0000 Cr. Cash $11,000
What is the journal entry Declan's Designs recorded to recognize the purchase of PPE in 2022? Question 6 options: Dr. PPE $10,0000 Cr. Cash $10,000 Dr. PPE $22,0000 Cr. Cash $22,000 Dr. PPE $12,0000 Cr. Cash $12,000 Dr. PPE $11,0000 Cr. Cash $11,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
What is the
Question 6 options:
|
Dr. PPE $10,0000 |
|
Dr. PPE $22,0000 |
|
Dr. PPE $12,0000 |
|
Dr. PPE $11,0000 |
![ASSETS
12/31/2021
12/31/2022
For the Year Ending
Current Assets
Cash and Cash Equivalents
Accounts Receivable, Net
Merchandise Inventory
12/31/2022
$90,000
97,000
400,000
587,000
$294,000
101,000
475,000
870,000
Sales Revenue
$225,000
(16,000)
209,000
(22,000)
187,000
(12,000)
(5,000)
170,000
(7,000)
$163,000
CGS
Total Current Assets
Gross Margin
SG&A
PPE, Net
Goodwill, Net
62,000
600,000
$1,249,000
70,000
600,000
$1,540,000
Operating Income
Interest Expense
Loss on Sale of PPE
Total Assets
Pre-Tax Income
Income Tax Expense
LIABILITIES & SHAREHOLDERS’ EQUITY
Current Liabilities
Accounts Payable
Interest Payable
Dividends Payable
Net Income
26,000
3,000
20,000
49,000
17,000
5,000
10,000
32,000
Additional Information regarding Declan's Designs' 12/31/22 financials:
Total Current Liabilities
Mortgage Payable
Long-Term Bank Loan
Total Liabilities
500,000
200,000
732,000
PROPERTY, PLANT & EQUIPMENT
PPE is shown net accumulated depreciation. Accumulated depreciation was $18,000 at the beginning of
the
500,000
and $20,000 at the end of the year. Depreciation expense for the year was $3,000, which is
year
included in SG&A. New PPE was bought during the year for $22,000 (in cash).
549,000
Shareholder's Equity
Preferred Stock
Note: You may use the worksheet provided on the last page to help you prepare the Cash Flow Statement.
8,000
54,000
638,000
700,000
Common Stock
Hint #1: The most recent year is not always in the left column.
Additional Paid in Capital
Retained Earnings
Total Shareholder's Equity
10,000
60,000
738,000
808,000
Hint #2: Evaluate changes in gross PPE separate from changes in accumulated depreciation. Recall gross
PPE less accumulated depreciation equals net PPE.
Hint #3: Never “plug" the annual change in gross PPE. Separately evaluate the increase in gross PPE
(capital expenditures) from the annual decrease in gross PPE (sale of PPE).
Total Liabilities &Shareholders' Equity
$1,249,000
$1,540,000
Hint #4: 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).
Hint #5: Dividends declared (the decrease in RE) is not the same as dividends paid (the decrease in
dividends payable). To find dividends paid, set up your dividends payable account with the beginning and
ending balances from the balance sheet. Increase dividends paid by the amount of dividends declared.
Then plug for the decrease in dividends payable (which represents dividends paid).](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3a4f9c71-5d26-45f6-9881-8adbb435ad05%2F9d38e908-fa26-4ad9-a496-0e5d3eea7db4%2Fil2kplo_processed.png&w=3840&q=75)
Transcribed Image Text:ASSETS
12/31/2021
12/31/2022
For the Year Ending
Current Assets
Cash and Cash Equivalents
Accounts Receivable, Net
Merchandise Inventory
12/31/2022
$90,000
97,000
400,000
587,000
$294,000
101,000
475,000
870,000
Sales Revenue
$225,000
(16,000)
209,000
(22,000)
187,000
(12,000)
(5,000)
170,000
(7,000)
$163,000
CGS
Total Current Assets
Gross Margin
SG&A
PPE, Net
Goodwill, Net
62,000
600,000
$1,249,000
70,000
600,000
$1,540,000
Operating Income
Interest Expense
Loss on Sale of PPE
Total Assets
Pre-Tax Income
Income Tax Expense
LIABILITIES & SHAREHOLDERS’ EQUITY
Current Liabilities
Accounts Payable
Interest Payable
Dividends Payable
Net Income
26,000
3,000
20,000
49,000
17,000
5,000
10,000
32,000
Additional Information regarding Declan's Designs' 12/31/22 financials:
Total Current Liabilities
Mortgage Payable
Long-Term Bank Loan
Total Liabilities
500,000
200,000
732,000
PROPERTY, PLANT & EQUIPMENT
PPE is shown net accumulated depreciation. Accumulated depreciation was $18,000 at the beginning of
the
500,000
and $20,000 at the end of the year. Depreciation expense for the year was $3,000, which is
year
included in SG&A. New PPE was bought during the year for $22,000 (in cash).
549,000
Shareholder's Equity
Preferred Stock
Note: You may use the worksheet provided on the last page to help you prepare the Cash Flow Statement.
8,000
54,000
638,000
700,000
Common Stock
Hint #1: The most recent year is not always in the left column.
Additional Paid in Capital
Retained Earnings
Total Shareholder's Equity
10,000
60,000
738,000
808,000
Hint #2: Evaluate changes in gross PPE separate from changes in accumulated depreciation. Recall gross
PPE less accumulated depreciation equals net PPE.
Hint #3: Never “plug" the annual change in gross PPE. Separately evaluate the increase in gross PPE
(capital expenditures) from the annual decrease in gross PPE (sale of PPE).
Total Liabilities &Shareholders' Equity
$1,249,000
$1,540,000
Hint #4: 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).
Hint #5: Dividends declared (the decrease in RE) is not the same as dividends paid (the decrease in
dividends payable). To find dividends paid, set up your dividends payable account with the beginning and
ending balances from the balance sheet. Increase dividends paid by the amount of dividends declared.
Then plug for the decrease in dividends payable (which represents dividends paid).
Expert Solution
![](/static/compass_v2/shared-icons/check-mark.png)
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
![Horngren's Cost Accounting: A Managerial Emphasis…](https://www.bartleby.com/isbn_cover_images/9780134475585/9780134475585_smallCoverImage.gif)
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
![Intermediate Accounting](https://www.bartleby.com/isbn_cover_images/9781259722660/9781259722660_smallCoverImage.gif)
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
![Financial and Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781259726705/9781259726705_smallCoverImage.gif)
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education