I can't get the titles correct for the Income Statement. THe ehlp I need is "yellow" highlighted. I have included all supporting data; Journal, Trial Balance. Can you explain what I should look for in the titles? What dictates what goes where? I try to look at other exercises to make correlations an get confused when they don't work. Avenger Company's balance sheet at December 31, 2021, is presented below.Avenger LLCDuring Jhnuary 2022, the following transactions occurred. (Avenger Company uses the perpetual inventory system.)Balance Sheet131-Dec-21Avenger paid $ 220 interest on the note payable on January 1, 2022. The note is due December 31, 2023.$ 26,400$ 12,100Avenger purchased $ 229,768 of inventory on account.Avenger sold for $ 387,200 cash, inventory which cost $ 233,200. Avenger also collected $ 25,168 insales taxes.Avenger paid $ 202.400 in accounts payable.Avenger paid $ 14.960 in sales taxes to the state.Paid other operating expenses of $ 26.400.On January 31, 2022, the payroll for the month consists of salaries and wages of $ 56,000. All salariesand wages are subject to 7.65% FICA taxes. A total of $ 7,840 federal income taxes are withheld. Thesalaries and wages are paid on February 1.CashAccounts Payable23InventoryPrepaid InsuranceEquipment27,060Interest Payable220Notes PayableOwner's Capital5,28044,000433,440$ 92,18035.860$92,18067Adjustment data:Interest expense of $ 220 has been incurred in January on the notes payable.The insurance for the year 2022 was prepaid on December 31, 2021.10The equipment was acquired on December 31, 2021, and will be depreciated on a straight-line basis over5 years with a $ 1,760 salvage value.Employer's payroll taxes include 7.65% FICA taxes, a 5.4% state unemployment tax, and an 0.6% federalunemployment tax11Avengers LLCJournal EntriesNo. Account Titles and Explanation1 Interest PayableAdjusted Trial BalanceDebit Credit220$194,788.00$ 23,628.00CashIncome StatementInventoryJanuary 31, 2022220Prepaid insuranceEquipmentS 4.840.00$ 33,440.00Cash2 Inventory229768Sales Revenue387200229768S 39,468.005 44,000.00$ 387,200.00S 10,208.00$ 8,568.00$ 7,840.00Accounts PayableAccounts PayableCost of Goods Sold3 CashSales Tax Payable412368Notes Payable-23320025168Sales RevenueSales taxes PayableFICA Taxes PayableFederal income Taxes PayableState unemployment taxes PayableSales Revenue387200OGross Profit / (Loss)154000(To record sales revenue.)Cost of Goods SoldInventory4 Accounts PayableCashslsales Taxes PayableCash6lother Operating Expenses233200Operating Expenses2332003,024.00| Insurance Expense$ 43,876.00S 35,860.00$ 336.00S 220.00440202400Salaries and wages PayableOwners CapitalFederal unemployment taxes Payable202400Рayroll Tax Eхpense76441496014960Interest payableOther Operating Expenses2640026400Other Operating ExpenseS 26,400.00$ 56,000.00Cash7Salaries and WagesFICA Taxes PayableFederal Income Taxes Payable26400Salaries and eages> Salaries and Wages Expense5600056000lInsurance Expense440.00$233,200.00!Depreciation Expense5284284Cost of Goods Sold784043876Accumulated Depreciation Expense528.00Salaries and Wages PayableDepreciation ExpenseS528.00Total Operating Expenses910128 Interest Expense220Interest Expense220.00$ 7,644.00Interest Payable220Payroll Taxe Expense629889insurance ExpensePrepaid Insurance10 Depreciation Expense440Total581.128581,128440528Accumulated Depreciation Expense52811 Payroll Taxe Expense7644Net income / (Loss)State Unemployment Taxes PayableFederal Unemployment Taxes PayableFICA taxes payable30243364284

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Description: I can't get the titles correct for the Income Statement. THe ehlp I need is "yellow" highlighted. I have included all supporting data; Journal, Trial Balance. Can you explain what I should look for in the titles? What dictates what goes where? I

Income statement is the statement which shows how much company has earned during the period. All the…

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Accounting

I can't get the titles correct for the Income Statement. THe ehlp I need is "yellow" highlighted. I have included all supporting data; Journal, Trial Balance. Can you explain what I should look for in the titles? What dictates what goes where? I try to look at other exercises to make correlations an get confused when they don't work.

I can't get the titles correct for the Income Statement. THe ehlp I need is "yellow" highlighted. I have included all supporting data; Journal, Trial Balance. Can you explain what I should look for in the titles? What dictates what goes where? I try to look at other exercises to make correlations an get confused when they don't work.

Financial Accounting

15th Edition

ISBN:9781337272124

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter6: Accounting For Merchandising Businesses

Section: Chapter Questions

Problem 9PA: On December 31, 2019, the balances of the accounts appearing in the ledger of Wyman Company are as...

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On June 30, 2019, the balances of the accounts appearing in the ledger of Simkins Company are as follows: Instructions 1. Does Simkins Company use a periodic or perpetual inventory system? Explain. 2. Prepare a multiple-step income statement for Simkins Company for the year ended June 30, 2019. The merchandise inventory as of June 30, 2019, was 508,000. The adjustment for estimated returns inventory for sales for the year ending December 31, 2019, was 33,000. 3. Prepare the closing entries for Simkins Company as of June 30, 2019. 4. What would the net income have been if the perpetual inventory system had been used?
Refer to the information provided in RE8-4. If Paul Corporations inventory at January 1, 2019, had a cost and net realizable value of 300,000, prepare the journal entry to record the reductions to NRV for Paul Corporation assuming that Paul uses a periodic inventory system and the allowance method. Paul Corporation uses FIFO and reports the following inventory information: Assuming Paul uses a perpetual inventory system and the direct method, prepare the journal entry to record the write-down of inventory.
On December 31, 2019, the balances of the accounts appearing in the ledger of Wyman Company are as follows: Instructions 1. Does Wyman Company use a periodic or perpetual inventory system? Explain. 2. Prepare a multiple-step income statement for Wyman Company for the year ended December 31, 2019. The merchandise inventory as of December 31, 2019, was 305,000. The adjustment for estimated returns inventory for sales for the year ending December 31, 2019, was 30,000. 3. Prepare the closing entries for Wyman Company as of December 31, 2019. 4. What would the net income have been if the perpetual inventory system had been used?
Rescue Sequences LLC purchased inventory by issuing a 30,000, 10%, 60-day note on October 1. Prepare the journal entries for Rescue Sequences to record the purchase and payment assuming it uses a perpetual inventory system and a 360-day calendar fiscal year. Rescue Sequences LLC uses a perpetual inventory system.
Refer to the information provided in RE8-4. If Paul Corporations inventory at January 1, 2019, had a cost and net realizable value of 300,000, prepare the journal entry to record the reductions to NRV for Paul Corporation assuming that Paul uses a periodic inventory system and the direct method. Paul Corporation uses FIFO and reports the following inventory information: Assuming Paul uses a perpetual inventory system and the direct method, prepare the journal entry to record the write-down of inventory.
The cost of the inventory on January 31, 2019, under the FIFO method is: a. 400 b. 2,700 c. 3,100 d. 3,200
At the end of 2019, Manny Company recorded its ending inventory at 350,000 based on a physical count. During 2020, the company discovered that the correct inventory value at the end of 2019 should have been 400,000 because it made a counting error. Upon discovery of this error in 2020, what correcting journal entry will Manny make? Ignore income taxes.
Serene Company purchases fountains for its inventory from Kirkland Inc. The following transactions take place during the current year. A. On July 3, the company purchases thirty fountains for $1,200 per fountain, on credit. Terms of the purchase are 2/10, n/30, invoice dated July 3. B. On August 3, Serene does not pay the amount due and renegotiates with Kirkland. Kirkland agrees to convert the debt owed into a short-term note, with an 8% annual interest rate, payable in two months from August 3. C. On October 3, Serene Company pays its account in full. Record the journal entries to recognize the initial purchase, the conversion, and the payment.
Use the same information in RE9-1 except that the note is not interest bearing. Assume that the note is discounted at a 15% rate. RE9-1 Rescue Sequences LLC purchased inventory by issuing a 30,000, 10%, 60-day note on October 1. Prepare the journal entries for Rescue Sequences to record the purchase and payment assuming it uses a perpetual inventory system and a 360-day calendar fiscal year. Rescue Sequences LLC uses a perpetual inventory system.
RE7-8 Johnson Company uses a perpetual inventory system. On October 23, Johnson purchased 100,000 of inventory on credit with payment terms of 1/15, net 45. Using the net price method, prepare journal entries to record Johnsons purchases on October 23 and the subsequent payment on October 31. Using the information from RE7-8, prepare journal entries to record Johnsons purchase on October 23 and the subsequent payment on November 30.
Company is considering purchasing EKC Company. EKCs balance sheet at December 31, 2019, is as follows: At December 31, 2019, Elm discovered the following about EKC: a. No allowance for uncollectible accounts has been established. An allowance of 5,000 is considered appropriate. b. The LIFO inventory method has been used. The FIFO inventory method would be used if EKC were purchased by Elm. The FIFO inventors-valuation of the December 31, 2019, ending inventors-would be 180,000. c. The fair value of the property, plant, and equipment (net) is 730,000. d. The company has an unrecorded patent that is worth 120,000. e. The book values of the current liabilities and bonds payable are the same as their market values. Required: 1. Compute the value of the goodwill if Elm pays 1,350,000 for EKC. 2. Next Level Why would the book value of a companys identifiable net assets differ from its market value?
Palisade Creek Co. is a merchandising business that uses the perpetual inventory system. The account balances for Palisade Creek Co. as of May 1, 2019 (unless otherwise indicated), are as follows: During May, the last month of the fiscal year, the following transactions were completed: Instructions 1. Enter the balances of each of the accounts in the appropriate balance column of a four-column account. Write Balance in the item section and place a check mark () in the Posting Reference column. Journalize the transactions for May, starting on Page 20 of the journal. 2. Post the journal to the general ledger, extending the month-end balances to the appropriate balance columns after all posting is completed. In this problem, you are not required to update or post to the accounts receivable and accounts payable subsidiary ledgers. 3. Prepare an unadjusted trial balance. 4. At the end of May, the following adjustment data were assembled. Analyze and use these data to complete (5) and (6). 5. (Optional) Enter the unadjusted trial balance on a 10-column end-of-period spreadsheet (work sheet), and complete the spreadsheet. 6. Journalize and post the adjusting entries. Record the adjusting entries on Page 22 of the journal. 7. Prepare an adjusted trial balance. 8. Prepare an income statement, a statement of owners equity, and a balance sheet. 9. Prepare and post the closing entries. Record the closing entries on Page 23 of the journal. Indicate closed accounts by inserting a line in both Balance columns opposite the closing entry. Insert the new balance in the owners capital account. 10. Prepare a post-closing trial balance.