Question

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	53		Inventories	68
Less accumulated depreciation	138		Receivables	125
Total current assets			Total current liabilities
Long-term debt	440		Interest expense	43
Property, plant, and equipment	610		Total liabilities
Net fixed assets			Shareholders’ equity	162
Total assets			Total liabilities and shareholders’ equity

INCOME STATEMENT
Net sales	880
Cost of goods sold	670
Selling, general, and administrative expenses	56
EBIT
Debt due for repayment	43
Cash	33
Taxable income
Taxes	33
Depreciation	30
Net income

Prepare the balance sheet and income statement by rearranging the above items.

Answer 1