Deedle company began the year with the following account balances: Cash $15,000 Accounts receivable $42,000 Inventory...

Deedle company began the year with the following account balances:

Cash	$15,000
Accounts receivable	$42,000
Inventory	$33,000
Accounts payable	$24,000
Paid-in capital	$45,000
Retained earnings	$21,000

During the year, Deedle had the following transactions:

a. Borrowed $30,000 on a long-term loan

b. Interest expense for the year was $3,000. This amount has not yet been paid in cash

c. Sales for the year were $500,000, all on account

d. Cash collections of accounts receivable, $280,000

e. Purchased inventory on account, $380,000

f. Cost of inventory sold was $350,000

g. Paid accounts payable, $173,000

h. Paid wage expense, $137,000

Q) Prepare an income statement for the year and a balance sheet (next page) as of the end of the year.

Solutions

Expert Solution

Q) Prepare an income statement for the year

Q) a balance sheet (next page) as of the end of the year.

working notes

cash balance

Cash -Beginning balance	$ 15,000
Less : Wages paid	$ (137,000)
Less : payment to account payable	$ (173,000)
Add : received from account receivable	$ 280,000
Add : long term loan borrowal	$ 30,000
cash as of the end of the year.	$ 15,000

ekkarill92 answered 1 year ago

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