Presented below is information related to Al-Arab Company. Its capital structure consists of 80,000ordinary shares. At December 31, 2020 an analysis of the accounts and discussions with companyofficials revealed the following information:Sales Revenues2,100,000Purchases1,284,000Purchase discounts36,000Cash120,000Loss on discontinued operations (net of tax)Selling expensesShare capital56,000256,000400,000Accounts receivable180,000Land740,000Accumulated depreciation360,000Dividend revenue16,000Inventory, January 1, 2020Inventory, December 31, 2020Unearned service revenue304,000250,0008,800Accrued interest payable2,000Dividends declared58,000Patents200,000Retained earnings, January 1, 2020Interest expenseGeneral and administrative expensesAccounts payable580,00034,000300,000120,000Allowance for doubtful accounts10,000Notes payable (maturity 7/1/25)Machinery and equipmentMaterials and supplies400,000900,00080,000 Note: The amount of income taxes was ¥91,200, including the tax effect of the discontinued operationsloss which amounted to ¥24,000.Instructions:Prepare an income statement and retained earnings statement for 2020 for Al-Arab Company thatis presented in accordance with IFRS (including format and terminology). Then answer thefollowing questions:1- The amount of cost of goods sold for 2020 equals?2- The amount of gross profit for 2020 equals?3- The amount of income from operations for 2020 equals?4- The amount of income tax for 2020 equals?5- The amount of income from continuing operations for 2020 equals?6- The amount of net income for 2020 equals?7- The amount of retained earnings on 31/12/2020 equals?

The question is related to the Ratio Analysis and Financial Statements for the year ended December…

Presented below is information related to Al-Arab Company. Its capital structure consists of 80,000 ordinary shares. At December 31, 2020 an analysis of the accounts and discussions with company officials revealed the following information: Sales Revenues 2,100,000 Purchases 1,284,000 Purchase discounts 36,000 Cash 120,000 Loss on discontinued operations (net of tax) Selling expenses Share capital 56,000 256,000 400,000 Accounts receivable 180,000 Land 740,000 Accumulated depreciation Dividend revenue 360,000 16,000 Inventory, January 1, 2020 Inventory, December 31, 2020 Unearned service revenue 304,000 250,000 8,800 Accrued interest payable Dividends declared 2,000 58,000 Patents 200,000 Retained earnings, January 1, 2020 Interest expense General and administrative expenses 580,000 34,000 300,000 Accounts payable 120,000 Allowance for doubtful accounts 10,000 Notes payable (maturity 7/1/25) Machinery and equipment Materials and supplies 400,000 900,000 80,000

Presented below is information related to Al-Arab Company. Its capital structure consists of 80,000 ordinary shares. At December 31, 2020 an analysis of the accounts and discussions with company officials revealed the following information: Sales Revenues 2,100,000 Purchases 1,284,000 Purchase discounts 36,000 Cash 120,000 Loss on discontinued operations (net of tax) Selling expenses Share capital 56,000 256,000 400,000 Accounts receivable 180,000 Land 740,000 Accumulated depreciation Dividend revenue 360,000 16,000 Inventory, January 1, 2020 Inventory, December 31, 2020 Unearned service revenue 304,000 250,000 8,800 Accrued interest payable Dividends declared 2,000 58,000 Patents 200,000 Retained earnings, January 1, 2020 Interest expense General and administrative expenses 580,000 34,000 300,000 Accounts payable 120,000 Allowance for doubtful accounts 10,000 Notes payable (maturity 7/1/25) Machinery and equipment Materials and supplies 400,000 900,000 80,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Concept explainers

Consolidation

Consolidation in general examination implies an asset oscillating between well-defined methods of trading status. Consolidation is commonly known as market indecisiveness, which completes when the asset's values move forward or backward the trading structure.

Question

Presented below is information related to Al-Arab Company. Its capital structure consists of 80,000
ordinary shares. At December 31, 2020 an analysis of the accounts and discussions with company
officials revealed the following information:
Sales Revenues
2,100,000
Purchases
1,284,000
Purchase discounts
36,000
Cash
120,000
Loss on discontinued operations (net of tax)
Selling expenses
Share capital
56,000
256,000
400,000
Accounts receivable
180,000
Land
740,000
Accumulated depreciation
360,000
Dividend revenue
16,000
Inventory, January 1, 2020
Inventory, December 31, 2020
Unearned service revenue
304,000
250,000
8,800
Accrued interest payable
2,000
Dividends declared
58,000
Patents
200,000
Retained earnings, January 1, 2020
Interest expense
General and administrative expenses
Accounts payable
580,000
34,000
300,000
120,000
Allowance for doubtful accounts
10,000
Notes payable (maturity 7/1/25)
Machinery and equipment
Materials and supplies
400,000
900,000
80,000

Note: The amount of income taxes was ¥91,200, including the tax effect of the discontinued operations
loss which amounted to ¥24,000.
Instructions:
Prepare an income statement and retained earnings statement for 2020 for Al-Arab Company that
is presented in accordance with IFRS (including format and terminology). Then answer the
following questions:
1- The amount of cost of goods sold for 2020 equals?
2- The amount of gross profit for 2020 equals?
3- The amount of income from operations for 2020 equals?
4- The amount of income tax for 2020 equals?
5- The amount of income from continuing operations for 2020 equals?
6- The amount of net income for 2020 equals?
7- The amount of retained earnings on 31/12/2020 equals?

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