Chapter 1, Problem 1.18E

Henry Josstick has just started his first accounting course and has prepared the following balance sheet and income statement for Omega Corp. Unfortunately, although the data for the individual items are correct, he is very confused as to whether an item should go in the balance sheet or income statement and whether it is an asset or liability.   BALANCE SHEET Payables $ 39   Inventories $ 54   Less accumulated depreciation   124   Receivables   55   Total current assets       Total current liabilities       Long-term debt $ 370   Interest expense $ 29   Property, plant, and equipment   540   Total liabilities       Net fixed assets       Shareholders’ equity $ 106   Total assets       Total liabilities and shareholders’ equity           INCOME STATEMENT Net sales $ 740   Cost of goods sold   600   Selling, general, and administrative expenses   42   EBIT       Debt due for repayment $ 29   Cash   19   Taxable income       Taxes $ 19…

Henry Josstick has just started his first accounting course and has prepared the following balance sheet and income statement for Omega Corp. Unfortunately, although the data for the individual items are correct, he is very confused as to whether an item should go in the balance sheet or income statement and whether it is an asset or liability.   a.Prepare the balance sheet and income statement by rearranging the above items. b.In the process of constructing the balance sheet, please show me the total current assets, total assets, total current liabilities, and total liabilities. c.In the process of constructing the income statement, please calculate the gross profit, operating profit (EBIT),taxable income and net profit.

Henry Josstick has just started his first accounting course and has prepared the following balance sheet and income statement for Omega Corporation. Unfortunately, although the data for the individual items are correct, he is very confused as to whether an item should go in the balance sheet or income statement and whether it is an asset or liability. BALANCE SHEET Payables $ 44 Inventories $ 59 Less accumulated depreciation 129 Receivables 80 Total current assets   Total current liabilities   Long-term debt $ 395 Interest expense $ 34 Property, plant, and equipment 565 Total liabilities   Net fixed assets   Shareholders’ equity $ 126 Total assets   Total liabilities and shareholders’ equity   INCOME STATEMENT Net sales $ 790 Cost of goods sold 625 Selling, general, and administrative expenses 47 EBIT   Debt due for repayment $ 34 Cash 24 Taxable income   Federal plus other taxes $ 24 Depreciation 21 Net income   Prepare the balance sheet…