Scribd
Upload
258 views3 pages

Financial Accounting 9th Edition by Libby Chapter 1

The document provides financial information for three different companies: 1) New World Book Store's balance sheet shows assets of $187,600 including cash, accounts receivable, and equipment. Liabilities include accounts payable and notes payable, with stockholders' equity of $172,300 from common stock and retained earnings. Net income for the year was $12,300. 2) Painter Corporation's income statement shows revenues of $305,000 and net income of $81,000 for the month. The balance sheet lists assets of $204,350 including cash and inventory, with liabilities of $60,950 including taxes payable. 3) Clint's Stonework Corporation presents

Uploaded by

Bernadette Concepcion
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
258 views3 pages

Financial Accounting 9th Edition by Libby Chapter 1

The document provides financial information for three different companies: 1) New World Book Store's balance sheet shows assets of $187,600 including cash, accounts receivable, and equipment. Liabilities include accounts payable and notes payable, with stockholders' equity of $172,300 from common stock and retained earnings. Net income for the year was $12,300. 2) Painter Corporation's income statement shows revenues of $305,000 and net income of $81,000 for the month. The balance sheet lists assets of $204,350 including cash and inventory, with liabilities of $60,950 including taxes payable. 3) Clint's Stonework Corporation presents

Uploaded by

Bernadette Concepcion
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
You are on page 1/ 3

P28 E1-2

A (1)Accounts receivable
A (2)Cash and cash equivalents
R (3)Net sales
L (4)Debt due within one year
L (5)Taxes payable
SE (6)Retained earnings
E (7)Cost of products sold
E (8)Selling, general and administrative expense
E (9)Income taxes
L (10)Accounts payable
A (11)Trademarks and other intangible assets
A (12)Property, plant, and equipment
L (13)Long-term debt
A (14)Inventories
E (15)Interest expense

P29 E1-5

Req. 1
NEW WORLD BOOK STORE
Balance Sheet
At December 31, Current Year

ASSETS LIABILITIES

Cash $75,600 Accounts payable $12,000


Accounts receivable 39,000 Note payable 3,000
Store and office equipment 73,000 Interest payable 300
Total liabilities 15,300

STOCKHOLDERS’ EQUITY

Common stock 160,000


Retained earnings 12,300
Total stockholders’ equity 172,300
Total liabilities and
Total assets $187,600 stockholders' equity $187,600

Req. 2
Net income for the year was $12,300. This is the first year of operations and no dividends were declared or
paid to stockholders; therefore, the ending retained earnings of $12,300 includes net income for one year.
P32 E1-11

PAINTER CORPORATION
Income Statement
For the Month of January Current Year
Total revenues $ 305,000
Less: Total expenses (excluding income tax) 189,000
Pretax income 116,000
Less: Income tax expense 35,000
Net income $ 81,000

PAINTER CORPORATION
Balance Sheet
At January 31, Current Year
Assets
Cash $ 65,150
Receivables from customers 44,700
Merchandise inventory 94,500
Total assets $204,350

Liabilities
Payables to suppliers $25,950
Income taxes payable 35,000
Total liabilities 60,950
Stockholders' Equity
Common stock (2,600 shares) 62,400
Retained earnings (from income statement above) 81,000
Total stockholders’ equity 143,400
Total liabilities and stockholders' equity $204,350
P33 E1-13

CLINT’S STONEWORK CORPORATION


Statement of Stockholders’ Equity
For the Year Ended December 31, 2016

Common Stock Retained Earnings


Balance December 31, 2015* $100,000 $16,800
Net income 42,000
Dividends $100,000 (18,700)
Balance December 31, 2016 $100,000 $40,100

* Beginning retained earnings + Net income – Dividends = Ending retained earnings


For 2015: $0 + 31,000 – 14,200 = $16,800;
Ending retained earnings for 2015 becomes beginning retained earnings for 2016.

You might also like