Managerial Accounting: The Cornerstone of Business Decision-Making
Managerial Accounting: The Cornerstone of Business Decision-Making
7th Edition
ISBN: 9781337115773
Author: Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher: Cengage Learning
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Please help me prepare a income statement and balance sheet .. I'm currently working on it and I need to know that I'm doing it correctly.

Below are the transactions and adjustments that occurred during he
rst year o operations at Kissick Co.
a. Issued 198,000 shares of $4-par-value common stock for $792,000 in cash
b. Borrowed $520,000 from Oglesby National Bank and signed a 11% note due in three years
c. Incurred and paid $380,000 in salaries for the year
d. Purchased $680,000 of merchandise inventory on account during the year
e. Sold inventory costing $570,000 for a total of $920,000, all on credit.
f. Paid rent of $110,000 on the sales facilities during the first 11 months of the year.
g. Purchased $180,000 of store equipment, paying $53,000 in cash and agreeing to pay the difference within 90 days
h. Paid the entire $127,000 owed for store equipment and $600,000 of the amount due to suppliers for credit purchases
previously recorded.
i. Incurred and paid utilities expense of $36,000 during the year
J. Collected $845,000 in cash from customers during the year for credit sales previously recorded
k. At year-end, accrued $57 200 of interest on the note due to Oglesby National Bank
l. At year-end, accrued $10,000 of past-due December rent on the sales facilities
Required:
a. Prepare an income statement (ignoring income taxes) for Kissick Co.'s first year of operations and a balance sheet
as of the end of the year. (Hint You may find it helpfui to prepare Taccounts for each account affected by the
transactions.)
KISSICK CO
Income Statement
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Transcribed Image Text:Below are the transactions and adjustments that occurred during he rst year o operations at Kissick Co. a. Issued 198,000 shares of $4-par-value common stock for $792,000 in cash b. Borrowed $520,000 from Oglesby National Bank and signed a 11% note due in three years c. Incurred and paid $380,000 in salaries for the year d. Purchased $680,000 of merchandise inventory on account during the year e. Sold inventory costing $570,000 for a total of $920,000, all on credit. f. Paid rent of $110,000 on the sales facilities during the first 11 months of the year. g. Purchased $180,000 of store equipment, paying $53,000 in cash and agreeing to pay the difference within 90 days h. Paid the entire $127,000 owed for store equipment and $600,000 of the amount due to suppliers for credit purchases previously recorded. i. Incurred and paid utilities expense of $36,000 during the year J. Collected $845,000 in cash from customers during the year for credit sales previously recorded k. At year-end, accrued $57 200 of interest on the note due to Oglesby National Bank l. At year-end, accrued $10,000 of past-due December rent on the sales facilities Required: a. Prepare an income statement (ignoring income taxes) for Kissick Co.'s first year of operations and a balance sheet as of the end of the year. (Hint You may find it helpfui to prepare Taccounts for each account affected by the transactions.) KISSICK CO Income Statement
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