Assets Current assets Cash Accounts receivable Inventory Total Total assets Fixed assets Net plant and equipment $333,695 Sales Cost of goods sold Depreciation Taxable income Taxes (24%) 2020 Earnings before interest and taxes Interest paid Net income $24,136 $25,000 13,348 16,100 26,722 28,000 $ 64,206 $ 69,100 SMOLIRA GOLF CORPORATION 2021 Income Statement Dividends Retained earnings SMOLIRA GOLF CORPORATION 2020 and 2021 Balance Sheets 2021 Liabilities and Owners' Equity Current liabilities $ 363,900 $397,901 $ 433,000 $ 29,000 19,122 Accounts payable Notes payable Other Long-term debt Owners' equity Common stock and paid-in surplus Accumulated retained earnings Total Total Total liabilities and owners' equity $ 383,818 257,000 48,300 $78,518 15,200 $ 63,318 15,196 $48,122 2020 $24,084 $ 28,000 19,000 11,700 12,471 18,300 $ 55,555 $ 58,000 $78,000 $91,532 2021 $60,000 $60,000 204,346 223,468 $ 264,346 $397,901 $ 283,468 $ 433,000

Assets Current assets Cash Accounts receivable Inventory Total Total assets Fixed assets Net plant and equipment $333,695 Sales Cost of goods sold Depreciation Taxable income Taxes (24%) 2020 Earnings before interest and taxes Interest paid Net income $24,136 $25,000 13,348 16,100 26,722 28,000 $ 64,206 $ 69,100 SMOLIRA GOLF CORPORATION 2021 Income Statement Dividends Retained earnings SMOLIRA GOLF CORPORATION 2020 and 2021 Balance Sheets 2021 Liabilities and Owners' Equity Current liabilities $ 363,900 $397,901 $ 433,000 $ 29,000 19,122 Accounts payable Notes payable Other Long-term debt Owners' equity Common stock and paid-in surplus Accumulated retained earnings Total Total Total liabilities and owners' equity $ 383,818 257,000 48,300 $78,518 15,200 $ 63,318 15,196 $48,122 2020 $24,084 $ 28,000 19,000 11,700 12,471 18,300 $ 55,555 $ 58,000 $78,000 $91,532 2021 $60,000 $60,000 204,346 223,468 $ 264,346 $397,901 $ 283,468 $ 433,000

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter7: Operating Assets

Section: Chapter Questions

Problem 24CE

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