Indigo Limited Statement of Financial Position As at December 31, 2019 and 2018 2019 2018 Assets Current assets Cash Accounts receivable Inventory Prepaid insurance Total current assets $22,500 100,000 57,500 15,000 $15,000 127,500 22,500 22,500 187,500 472,500 $660,000 195,000 Property, plant and equipment, net Total assets 600,000 $795,000 Liabilities Current liabilities Accounts payable Salaries payable Total current liabilities $60,000 37,500 $97,500 112,500 210,000 $75,000 60,000 $135,000 225,000 360,000 Noncurrent liabilities Total liabilities Shareholders' Equity Ordinary shares, $100 par Retained earnings Total shareholders' equity Total liabilities and equity $435,000 150,000 _585,000 $795,000 $225,000 75,000 300,000 $660,000 Indigo Limited Income Statement For the year ended December 31, 2019 2019 Sales (all on credit) Less: Cost of goods sold Gross profit Less: Operating expenses Operating profit Less: Income tax expense $600,000 315,000 285,000 82,500 202,500 40,500 $ 162,000 Profit for the year

Indigo Limited Statement of Financial Position As at December 31, 2019 and 2018 2019 2018 Assets Current assets Cash Accounts receivable Inventory Prepaid insurance Total current assets $22,500 100,000 57,500 15,000 $15,000 127,500 22,500 22,500 187,500 472,500 $660,000 195,000 Property, plant and equipment, net Total assets 600,000 $795,000 Liabilities Current liabilities Accounts payable Salaries payable Total current liabilities $60,000 37,500 $97,500 112,500 210,000 $75,000 60,000 $135,000 225,000 360,000 Noncurrent liabilities Total liabilities Shareholders' Equity Ordinary shares, $100 par Retained earnings Total shareholders' equity Total liabilities and equity $435,000 150,000 _585,000 $795,000 $225,000 75,000 300,000 $660,000 Indigo Limited Income Statement For the year ended December 31, 2019 2019 Sales (all on credit) Less: Cost of goods sold Gross profit Less: Operating expenses Operating profit Less: Income tax expense $600,000 315,000 285,000 82,500 202,500 40,500 $ 162,000 Profit for the year

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter13: Investments And Long-term Receivables

Section: Chapter Questions

Problem 14P: Investments in Equity Securities Noonan Corporation prepares quarterly financial statements and...

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Investments in Equity Securities Noonan Corporation prepares quarterly financial statements and invests its excess funds in marketable securities. At the end of 2018, Noonans portfolio of investments consisted of the following equity securities: Dunne the first half of 2019, Noonan engaged in the following investment transactions: Required: 1. Record Noonans investment transactions for January 6 through June 30, 2019. 2. Show the items of income or loss from investment transactions that Noonan reports for each of the first and second quarters of 2019. 3. Show how the preceding items are reported on the first and second quarter 2019 ending balance sheets, assuming that management expects to dispose of the Keene and Sachs securities within the next year.
l-Itihad Corporation Balance SheetDecember 31, 2019AssetsLiability & EquityCurrent AssetsCurrent LiabilityCash$5,000Accounts payable22,000Short term securities10,000Accrual Account8,000Account Receivables30,000Short term debt6,000Inventory32,000Total Current Liability36,000Long-term debt40,000Total Current Assets77,000TotalLiability76,000Long term AssetsEquityNet Property & equipment70,000CommonStocks64,000Retained earnings17,000Total Equity81,000Total Liability and Equity157,000Other assts 10000Total Assets157,000Sur Corporation Income StatementDecember 31, 2019Other Financial information of Sur corporation December 31, 2019Net sales (revenue)$150,000· Average Number of Common shares outstanding 16,000 Shares· Market price of Common share $3.5Cost of goods sold80,000Gross profit70,000Operating expenses30,000EBIT- (Operating profit)40,000Interest expense10,000EBT- ( Earnings before taxes)30,000Income tax 10,000Net Income (net profit)20,000You have to find the following ratios…
TOPICS: INVESTMENTS/DERIVATIVES O Company purchased a P 1 000 000 ordinary lifeinsurance policy on its president. O is the beneficiaryunder the life insurance policy. The policy year and theentity’s accounting year coincide. Additional dataavailable for the year ended December 31, 2021 are asfollows:Cash surrender value, January 1= 43 500 000Cash surrender value, December 31= 54 000 000Annual advance premium paid Jan 1= 20 000 000Dividend received July 1= 3 000 000 What amount should be reported as lifeinsurance expense for 2021? P Co. has maintained funds in Q Bank. Plan A adopted a plan to accumulateP 10 000 000 by September 1, 2030. Theentity plans to make four equal annualdeposits to a fund that will earn interestat 10% compounded annually. What isthe annual deposit to the fund? (round ofFV factors to three decimal places) Plan B has annual payments of P 500000. How much will it’s maturity be after10 years at 7% interest compoundedannually. Plan C has one time investment…
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Financial Statement Violations of U.S. GAAP The following are the financial statements issued by Allen Corporation for its fiscal year ended October 31, 2019: Notes to Financial Statements: 1. Long-Term Lease. Under the terms of a 5-year, noncancelable lease for a building, Allen is obligated to make annual rental payments of 40,000 in each of the next 4 fiscal years. 2. Pension Plan. Substai1tially all employees are covered by Allens defined benefit pension plan. Pension expense is equal to the total of pension benefits accrued and paid to retired employees during the year. Because it is a defined benefit plan that is paid every year, no pension liability exists. 3. Patent. The patent had an estimated remaining life of 10 years at the time of purchase. Allens patent was purchased from Apex Corporation on January 1, 2019, for 250,000. 4. Deferred Income Tax Payable. The entire balai1ce in the Deferred Income Tax Payable account arose from tax-exempt municipal bonds that were held during the previous fiscal year, giving rise to a difference between taxable income and reported net earnings for the fiscal year ended October 31, 2019. The deferred liability amount was calculated on the basis of past tax rates. 5. Warrants. On January 1, 2018, one common stock warrant was issued to shareholders of record for each common share owned. An additional share of common stock is to be issued upon exercise of 10 stock warrants and receipt of an amount equal to par value. For the 6 months ended October 31, 2019, the average market value for Allens common stock was 5 per share and no warrants had yet been exercised. 6. Contingent Liability. On October 31, 2019, Allen was contingently liable for product warranties in an amount estimated to aggregate 75,000. Required: Next Level Review the preceding financial state1nents and related notes. Identify any inclusions or exclusions from them that would be in violation of GAAP, and indicate corrective action to be taken. Do not comment as to format or style. Respond in the following order: 1. Balance sheet 2. Notes 3. Income statement 4. Statement of retained earnings 5. General
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