Concept explainers
(a)
Income statement: The financial statement which reports revenues and expenses from business operations, and the result of those operations as net income or net loss for a particular time period is referred to as income statement.
To prepare: Income statement of P Pics for the year ended December 31, 2016
(b)
Statement of retained earnings: This statement reports the beginning retained earnings and all the changes which led to ending retained earnings. Net income from income statement is added to and dividends is deducted from beginning retained earnings to arrive at the end result, ending retained earnings.
To prepare: Statement of retained earnings of P Pics for the year ended December 31, 2016
(c)
To prepare: Balance sheet of P Pics as of December 31, 2016
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Horngren's Financial & Managerial Accounting, The Financial Chapters (Book & Access Card)
- Question: Perform the following accounting for the receivables of A & G, an accounting firm, at December 31, 2014. 1. Start with the beginning balances for these T-accounts: Accounts Receivable, $80,000 Allowance for Uncollectible Accounts, $9,000 Post the following 2014 transactions to the T-accounts: a. Service revenue of $850,000, all on account b. Collections on account, $790,000 c. Write-offs of uncollectible accounts, $7,000 d. Bad debt expense (allowance method), $8,000 2. What are the ending balances of Accounts Receivable and Allowance for Uncollectible Accounts? 3. Show two ways A & G could report accounts receivable on its balance sheet at December 31, 2014. Please explain & show steps, thank you.arrow_forwardThe details of the accounts receivable of AA Corporation as December 31, 2022 shows the following: Beginning balance P3,450,000 Sales on account made to customers 2,800,000 Collection of accounts receivable during the year 4,200,000 Accounts written off as uncollectible 90,000 The following transactions were included in the recorded transactions during the year: 1. Invoice dated December 28, 2022 for P350,000 was shipped and received by the buyer on December 31, 2022, this invoice was recorded in the book at P35,000. 2. Invoice dated and recorded on November 30, 2022 was erroneously priced at P32 per unit. There were 11,000 units of goods delivered which were received on December 10, 2022. The agreed price should be at P22 per unit only. AA's policy is to provide 5% of the outstanding balance of accounts receivable as uncollectible and there is beginning balance of allowance for bad debts of P40,000. Statement 1: The amount of bad debt expense in 2022 is P158,250. Statement 2: The…arrow_forwardBaker Company had the following balances in its accounting records as of December 31,2016: Assets Liabilities and Equity Cash $35,000 Accounts Payable 7,500 Accounts Receivable 9,000 Inventory 10,000 Common Stock 40,000 Land 41,000 Retained Earnings 47,500 Total 95,000 Total 95,000 The following accounting events apply to Baker Company’s 2017 fiscal year: May 1 Made cash payment on accounts payable of $5,500. June 1 Purchased $60,000 inventory on account. August 1 Sold $31,000 worth of inventory for $56,000. The customer paid $22,000 in cash. Nov. 1 Paid $51,000 owed to the supplier. Dec. 31 Received cash collections from accounts receivable amounting to $36,000. Incurred other operating expenses on account during the year that amounted to $8,000. Record Journal entries for each transaction. Prepare 2017’s Income Statement and Balance Sheet for Baker…arrow_forward
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- Traders, Inc. uses accrual accounting. Its balance sheet as of the end of the third quarter of the calendar year 2015 is shown on the following page: TRADERS, INC. Balance Sheet September 30, 2015 Assets Liabilities and Equity P 416,000 Accounts payable Capital stock Retained earnings P 1,400,000 7,200,000 3,536,000 Cash Accounts receivable, net Merchandise inventory 1,200,000 2,520,000 8,000,000 Non-current assets Total liabilities and P 12,136.000 Stockholders' equity P 12,136,000 Total assets Additional information: • Budgeted sales for October is P 4,160,000; for November, P 4,000,000 • Gross profit rate is 20% • Of the total sales, 40% is on credit which the company collects in the month following the month of sale. • Purchases in each month are composed of: 80% of the coming month's requirement 20% of the current month's requirement Purchases are paid for in the month following the month of purchase Questions: The budgeted cash collections for the month of October is Budgeted…arrow_forwardGiven the ledger accounts of Barella Company as of January 31, 2020: Accounts Payable $3,000 Rent Expense $5,600 Accounts Receivable 4,400 Service Revenue 10,400 Cash 8,800 Supplies 2,200 Share Capital-Ordinary 5,200 Notes Payable 2,400 Compute the total of the credit side of the trial balance. (show your computation). A. 22,000 B. 28,000 C. 26,000 O D. 21,000arrow_forwardOn January 1, 2021, Displays Incorporated had the following account balances: Debit 41,000 38,000 44,000 77,000 246,000 Accounts Cash Accounts receivable Supplies Inventory Land Accounts payable Notes payable (5%, due next year) Common stock Retained earnings Totals $ Credit $ 56,000 39,000 205,000 146,000 $ 446,000 $ 446,000 From January 1 to December 31, the following summary transactions occurred: a. Purchased inventory on account for $349,000. b. Sold inventory on account for $665,000. The cost of the inventory sold was $329,000. c. Received $594,000 from customers on accounts receivable. d. Paid freight on inventory received, $43,000. e. Paid $339,000 to inventory suppliers on accounts payable of $347,000. The difference reflects purchase discounts of $8,000. f. Paid rent for the current year, $61,000. The payment was recorded to Rent Expense. g. Paid salaries for the current year, $169,000. The payment was recorded to Salaries Expense. Year-end adjusting entries: a. Supplies on…arrow_forward
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