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

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter14: Statement Of Cash Flows

Section: Chapter Questions

Problem 17BEA

See similar textbooks

Related questions

Question

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

Definition Definition Financial statement that provides a snapshot of an organization's financial position at a specific point in time. It summarizes a company's assets, liabilities, and shareholder's equity, detailing what the company owns, what it owes, and what is left over for its owners. The balance sheet serves as a crucial tool to assess the financial health and stability of a company, as well as to help management make informed decisions about its future investments and financial obligations.

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 3 steps with 3 images

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions