BuyFindarrow_forward

Accounting (Text Only)

26th Edition
Carl Warren + 2 others
ISBN: 9781285743615

Solutions

Chapter
Section
BuyFindarrow_forward

Accounting (Text Only)

26th Edition
Carl Warren + 2 others
ISBN: 9781285743615
Textbook Problem
3637 views

Missing amounts from balance sheet and income statement data

One item is omitted in each of the following summaries of balance sheet and income statement data for the following four different proprietorships:

Chapter 1, Problem 1.20EX, Missing amounts from balance sheet and income statement data One item is omitted in each of the

Determine the missing amounts, identifying them by letter. (Hint: First, determine the amount of increase or decrease in owner's equity during the year.)

To determine

Income statement: The financial statement which reports revenues and expenses from business operations and the result of those operations as net income or net loss for a particular time period is referred to as income statement.

Balance sheet: This financial statement reports a company’s resources (assets) and claims of creditors (liabilities) and stockholders (stockholders’ equity) over those resources. The resources of the company are assets which include money contributed by stockholders and creditors. Hence, the main elements of the balance sheet are assets, liabilities, and stockholders’ equity.

To Determine:  The missing amount in the given statements.

Explanation

a)

The additional investment of Company F is calculated below.

Stockholders’ equity at end of year (1) $930,000
Stockholders’ equity at beginning of year (2) $540,000
Increase in stockholders’ equity $390,000
Deduct increase due to net income (3) $330,000
 Increase due to additional investments less withdrawals $60,000
Add withdrawals $75,000
Additional common stock issued $135,000

Table (1)

Hence, the additional investment of Company F is $135,000.

Working Note:

Calculate the Stockholders’ equity at end of year:

Stockholders’ equityat end of year}= Assets at end of yearLiabilities at end of year= $1,260,000 $330,000=$930,000

(1)

Calculate the Stockholders’ equity at beginning of year:

Stockholders’ equityat beginning of year}(Assets at beginningof year)(Liabilities at beginningof year)= $900,000 $360,000=$540,000

(2)

Calculate the Net Income during the year:

Net Income= Revenue  Expenses= $570,000 $240,000=$330,000

(3)

b)

The revenue of Company H is calculated below.

Stockholders’ equity at end of year  (4) $455,000
Stockholders’ equity at beginning of year  (5) 230,000
Increase in stockholders’ equity $225,000
Add withdrawals 32,000
Increase due to additional investment and net income $257,000
Deduct Additional investment 150,000
Increase due to Net income $107,000
Add expenses 128,000
Revenue $235,000

Table (2)

Hence, the revenue of Company H is $235,000.

Working Note:

Calculate the Stockholders’ equity at end of year:

Stockholders’ equityat end of year}= Assets at end of yearLiabilities at end of year= $675,000 $220,000=$455,000

(4)

Calculate the Stockholders’ equity at beginning of year:

Stockholders’ equityat beginning of year}(Assets at beginningof year)(Liabilities at beginningof year)= $490,000 $260,000=$230,000

(5)

c)

The withdrawals from Company J are calculated below

Still sussing out bartleby?

Check out a sample textbook solution.

See a sample solution

The Solution to Your Study Problems

Bartleby provides explanations to thousands of textbook problems written by our experts, many with advanced degrees!

Get Started

Additional Business Solutions

Find more solutions based on key concepts

Show solutions add

(Costs in the Short Run) Identify each of the curves in the following graph:

ECON: MICRO4 (New, Engaging Titles from 4LTR Press)

Why isnt trade among countries like a game with some winners and some losers?

Brief Principles of Macroeconomics (MindTap Course List)

Why do economists make assumptions?

Essentials of Economics (MindTap Course List)

Define check tampering.

Accounting Information Systems

EXCESS CAPACITY Edney Manufacturing Company has 2 billion in sales and 0.6 billion in fixed assets. Currently, ...

Fundamentals of Financial Management, Concise Edition (with Thomson ONE - Business School Edition, 1 term (6 months) Printed Access Card) (MindTap Course List)

What is Miamis living wage rate?

PAYROLL ACCT.,2019 ED.(LL)-TEXT