Question

The comparative balance sheet of Harris Industries Inc. at December 31, 20Y4 and 20Y3, is as follows: Dec. 31, 20Y4 Dec. 31, 20Y3 Assets Cash $443,240 $360,920 Accounts receivable (net) 665,280 592,200 Inventories 887,880 1,022,560 Prepaid expenses 31,640 25,200 Land 302,400 302,400 Buildings 1,713,600 1,134,000 Accumulated depreciation—buildings (466,200) (414,540) Machinery and equipment 781,200 781,200 Accumulated depreciation—machinery and equipment (214,200) (191,520) Patents 106,960 112,000 Total assets $4,251,800 $3,724,420 Liabilities and Stockholders' Equity Accounts payable (merchandise creditors) $837,480 $927,080 Dividends payable 32,760 25,200 Salaries payable 78,960 87,080 Mortgage note payable, due in nine years 224,000 0 Bonds payable 0 390,000 Common stock, $5 par 200,400 50,400 Paid-in capital: Excess of issue price over par—common stock 366,000 126,000 Retained earnings 2,512,200 2,118,660 Total liabilities and stockholders' equity $4,251,800 $3,724,420 An examination of the income statement and the accounting records revealed the following additional information applicable to 20Y4: Net income, $524,580. Depreciation expense reported on the income statement: buildings, $51,660; machinery and equipment, $22,680. Patent amortization reported on the income statement, $5,040. A building was constructed for $579,600. A mortgage note for $224,000 was issued for cash. 30,000 shares of common stock were issued at $13 in exchange for the bonds payable. Cash dividends declared, $131,040

Answer 1