Question

eBook Problem 9-01 From the following information, construct a simple income statement and a balance sheet: Sales $1,300,000 Finished goods 100,000 Long-term debt 200,000 Raw materials 130,000 Cash 80,000 Cost of goods sold 650,000 Accounts receivable 190,000 Plant and equipment 530,000 Interest expense 90,000 Number of shares outstanding 110,000 Earnings before taxes 470,000 Taxes 120,000 Accounts payable 220,000 Other current liabilities 60,000 Other expenses 90,000 Equity 550,000 Round your answer for earnings per share to the nearest cent. Corporation X: Income Statement for the Year Ended XX/XX/XX Sales $ Cost of goods sold Other expenses Earnings before interest and taxes Interest expense Earnings before taxes Taxes Net earnings $ Number of shares outstanding Earnings per share $ Corporation X Balance Sheet as of XX/XX/XX Assets Liabilities and Owners' Equity Cash $ Accounts payable $ Accounts receivable Other current liabilities Inventories  Total current liabilities $  Raw materials $ Long-term debt  Finished goods Equity   Total inventories   Total current assets $ Plant and Equipment  Total assets $  Total liabilities and shareholders’ equity $

Answer 1

-Preparing income Statement & Balance SHeet:-

Particular	Amt in $
Sales	1,300,000.00
Less: COGS	(650,000.00)
Gross Profit	650,000.00
Less: Other Expenses	(90,000.00)
EBIT	560,000.00
Less: Interest Expense	(90,000.00)
Taxable Income	470,000.00
Less: Taxation (35%)	(120,000.00)
Net income	350,000.00
No of shares outstanding	110,000
Earnings Per share	3.18

- Balance Sheet

ASSETS		Amt in $	LIABILITIES	Amt in $
Cash		80,000	Accounts payable	220,000.00
Accounts receivables		190,000.00	Other Current Liabilities	60,000.00
Inventory			Current Liabilities	280,000.00
Raw material	130,000.00
Finished Goods	100,000.00		Long term Liabilities:	200,000.00
Total Inventory		230,000.00
Current Assets		500,000.00	Equity	550,000.00
Plant and Equipment		530000		-
TOTAL ASSETS		1,030,000.00	TOTAL LIABILITIES AND OWNER"S EQUITY	1,030,000.00