Chapter 1, Problem 1.3E

Matching Financial Statement Items to Financial Statement Categories

Tootsie Roll Industries is engaged in the manufacture and sale of candy. Major products include Tootsie Roll, Tootsie Roll Pops. Tootsie Pop Drops. Tootsie Flavor Rolls. Charms, and Blow-Pop lollipops. The following items were listed on Tootsie Roll’s recent income statement and balance sheet. Mark each item from the balance sheet as an asset (A), liability (L). or shareholders’ equity (SE) item and mark each item from the income statement as a revenue (R) or expense (E) item.

_____ (1) Bank loans	_____ (10) Machinery and equipment
_____ (2) Selling, marketing, and administrative expenses	_____ (11) Net product sales
_____ (3) Accounts payable	_____ (12) Inventories
_____ (4) Dividends payable	_____ (13) Trademarks
_____ (5) Retained earnings	_____ (14) Buildings
_____ (6) Cash and cash equivalents	_____ (15) Land
_____ (7) Accounts receivable	_____ (16) Income taxes payable
_____ (8) Provision for income taxes*	_____ (17) Rental and royalty costs
_____ (9) Product cost of goods sold	_____ (18) Investments (in other companies)