Question

a. Prepare the adjusting entry required to update the inventory and related accounts at December 31. Update the affected accounts. (List all debit entries before credit entries. Credit account titles are automatically indented when the amount is entered. Do not indent manually. If a journal entry is not required, select "No entry required" for each account name and enter 0 as the amount.)

b. Prepare a multiple-step statement of income for the year.
c. Prepare a statement of changes in equity for the year. (Enter negative amounts using either a negative sign preceding the number, e.g. -25 or parentheses e.g. (25).)
d. Prepare a statement of financial position as at December 31. (List Current assets in order of liquidity. List Property, plant and equipment in order of land, building and equipment.)

Concord Athletic Wear Inc.’s adjusted trial balance amounts (with the exclusion of the adjusting entry to update Inventory and Cost of Goods Sold accounts) appear in alphabetical order as follows on December 31, 2021, the end of its fiscal year:

Accounts payable		$108,460		Inventory, Jan. 1		$53,460
Accounts receivable		58,344		Land		99,000
Accumulated depreciation—buildings		68,376		Mortgage payable		165,000
Accumulated depreciation—equipment		56,628		Prepaid insurance		3,168
Administrative expenses		238,788		Property tax payable		6,336
Buildings		250,800		Purchases discounts		29,700
Cash		22,440		Purchase returns and allowances		8,448
Common shares		69,300		Purchases		530,112
Deferred revenue		10,956		Refund liability		5,456
Dividends declared		10,560		Retained earnings		90,552
Equipment		145,200		Salaries payable		4,620
Freight in		7,392		Sales		840,840
Income tax expense		21,120		Selling expenses		10,560
Interest expense		13,728

Additional information:

1.		Concord Athletic Wear uses a periodic inventory system.
2.		A physical inventory count determined that Inventory on December 31, 2021, was $95,832.
3.		Of the mortgage payable, $16,500 is due in the next year.
4.		Common shares of $33,000 were issued during the year.

Answer 1

Solution: 1
	MULTIPLE STEP - INCOME STATEMENT
	AS ON YEAR ENDED DEC 31. 2021
		Amount	Amount
	Revenue
	Sales Revenue		$          840,840
	Less: Cost of Goods Sold
	Invetory Jan. 01	$              53,460
	Purchase	$            530,112
	Freight In	$                 7,392
	Total Goods Avaialble	$            590,964
	Less: Purchase Returns & Allowance	$                 8,448
	Less: Purchase Discounts	$              29,700
	Less: Ending inventory	$              95,832	$          456,984
	Gross Profit		$          383,856
	Less: Operating Expenses
	Administrative Expenses	$            238,788
	Selling Expenses	$              10,560
	Total Operating Expenses		$          249,348
	Operating Income		$          134,508
	Non-Operating and others
	Interest Expenses		$           -13,728
	Net Income		$          120,780
	Less: Income Tax Expenses		$             21,120
	Net Income after Taxes		$             99,660
Solution: 2
	Statement of Retained Earnings
	Beginning Balance .	$              90,552
	Add: Net income of the year	$              99,660
	Total	$            190,212
	Less: Dividend Declared	$              10,560
	Ending Balance	$            179,652