Question

1). Prepare a Balance Sheet with an ending date of July 31, 2020 based on the following information:

1) marketable security 26480

2). Scholarship fund 121947

3) Customers owe 25000

4) Building has 8 yea service life

5) land sold at 13% over market value

6) Furniture bought February 1,2020 16000

7) cash equals sell of land

8) Note receivable 54000

9) Insurance bought for 3 years July 1, 2017 100000

10) 20% of customer debt not collectible

11) land appreciates at 7 ½% each year

12) building bought August 1, 2019 720000

13) patent royalty 55,000

14) land purchased January 1, 2017 2,500,000

15) Furniture 4 year service life

16) copyright 17432

17) equipment purchased April 1, 2018 340,000

18) purchase of supplies 97104

19) common @ 113/each

20) wages 16247

21) preferred@ 226/each

22) retained earnings 2456789

23) equipment 20 year service life

24) commissions 87009

25) long term loan 1165430

26) common sold 255 shares

27) building mortgage 612866

28) preferred sold 357 shares

29) taxes owed 6700 + 1% land purchase

30) note payable 1/6 of note receivable

31 )merchandise inventory 3470

2). Prepare an Income Statement based on the following information:

Gross Sales = 1,573,200

Cost of goods sold = 20% of inventory from balance sheet

Depreciation (building) = 1year of depreciation for building from balance sheet

Discounts on sales = 19,780

Sales expense = 14% of net sales

Returns = 420,048

Interest expense = 6 ¼ % of gross sales

Administrative expense =35,790

Income from other sources = 233,577

Taxes = 33 ½ %

1 and 2 go together..

Answer 1

1	Assets	Amount
	Marketable Security	26,480.00
	Scholarship Fund	121,947.00
	Account Receivable	25,000.00
	Provision for Bad Debts	(5,000.00)
	Note Receivable	54,000.00
	Cash	3,342,980.00
	Building	720,000.00
	Accumulated Depreciation on Building	(90,000.00)
	Furniture	16,000.00
	Accumulated Depreciation on Furniture	(2,000.00)
	Equipment	340,000.00
	Accumulated Depreciation on Equipment	(39,667.00)
	Inventory	3,470.00
	Patent Royalty	55,000.00
	Copyright	17,432.00
	Total Assets	4,585,642.00
	Liabilities	Amount
	Accounts Payable	97,104.00
	Wages Payable	16,247.00
	Commissions	87,009.00
	Long term loan	1,165,430.00
	Notes Payable	9,000.00
	Building Mortgage	612,866.00
	Taxes Owed	31,700.00
	Common Shares	28,815.00
	Preferred Shares	80,682.00
	Retained Earnings	2,456,789.00
	Total Liabilities	4,585,642.00
2	Income Statement	Amount
	Gross Sales	1,573,200.00
	Discount	(19,780.00)
	Sales	1,592,980.00
	Returns	(420,048.00)
	Net Sales	1,172,932.00
	Other Income	233,577.00
	Total Income	1,406,509.00
	Cost of Goods Sold	694.00
	Depreciation of Building	90,000.00
	Sales Expenses	164,210.48
	Interest Expenses	98,325.00
	Administrative Expense	35,790.00
	Total Expenses	389,019.48
	Net Profit	1,017,489.52
	Taxes @ 33.5%	340,858.99
	Profit After Taxes	676,630.53