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Accounting Problems

Balance Sheet Preparation
From the following data, prepare a classified balance sheet for Simon Company at December 31, 2006.

Spreadsheet

Accounts payable $62,500
Accounts receivable 123,000
Buildings 418,500
Owners' equity, 1/1/06 210,000
Cash 179,750
Distributions to owners during 2006 21,750
Supplies 3,750
Land 130,000
Mortgage payable 479,500
Net income for 2006 124,750
Owners' equity, 12/31/06 ?????

Income Statement Preparation

The following selected information is taken from the records of Beckstrom Corporation.

Accounts payable $35,000
Accounts receivable 65,000
Advertising expense 15,000
Cash 19,500
Supplies expense 46,000
Rent expense 10,000
Utilities expense 3,000
Income taxes (30% of income before taxes) ????
Misc. expense 4,400
Owners' equity 140,000
Salaries expense 61,000
Feels (revenues) 384,000

1. Prepare an income statement for the year ended December 31, 2006. (Assume that 7,500 shares of stock are outstanding.)

Cash Flow Computations

From the follwing selected data, compute:
1. Net cash flow provided (used) by operating activities.
2. Net cash flow provided (used) by investing activities.
3. Net cash flow provided (used by financing activities.
4. Net increase (decrease) in cash during the year.
5. The cash balance at the end of the year.

Cash receipts from:
Customers $270,000
Investments by owners 54,000
Sale of building 90,000
Proceeds from bank loan 60,000
Cash payments for:
Wages $82,000
Utilities 3,000
Advertising 4,000
Rent 36,000
Taxes 67,000
Dividends 20,000
Repayment of principal on loan 40,000
Purchase of land 106,000
Cash balance at beginning of year $386,000

Retained Earnings Computations

During 2006, Edgemont Corporation had revenues of $230,000 and expenses, including income taxes, of $190,000. On December 31, 2005, Edgemont had assets of $350,000, liabilities of $80,000, and capital stock of $210,000. Edgemont paid a cash dividend of $25,000 in 2006. No additional stock was issued. Compute the retained earnings on December 31, 2005, and 2006.

Cash Flow Classifications

For each of the following items, indicate whether it would be classified and reported under the operating activities (OA), investing activities (IA), or financing activities (FA) section of a statement of cash flows:

a. Cash receipts from selling merchandise
b. Cash payment for wages and salaries
c. Cash proceeds from sold of stock
d. Cash purchase of equipment
e. Cash dividends paid
f. Cash received from bank loan
g. Cash payments for inventory
h. Cash receipts from services rendered
i. Cash payments for taxes
j. Cash proceeds from sale of property no longer needed as expansion site.

Attachments

Solution Preview

Balance Sheet Preparation
From the following data, prepare a classified balance sheet for Simon Company at December 31, 2006.

Spreadsheet

Accounts payable $62,500
Accounts receivable 123,000
Buildings 418,500
Owners' equity, 1/1/06 210,000
Cash 179,750
Distributions to owners during 2006 21,750
Supplies 3,750
Land 130,000
Mortgage payable 479,500
Net income for 2006 124,750
Owners' equity, 12/31/06 ?????

Simon Company
Statement of Retained Earnings
For the year ended December 31, 2006

Owners' equity, 1/1/06 210,000
Add: Net income for 2006 124,750
Less: Distributions to owners during 2006 21,750
Owners' equity, 12/31/06 313,000

Simon Company
Balance Sheet
December 31, 2006

Current Assets
Cash 179,750
Accounts receivable 123,000
Supplies 3,750
Total Current Assets 306,500

Property and Equipment
Buildings 418,500
Land 130,000
Total Property and Equipment 548,500
Total Assets 855,000

Current Liabilities
Accounts payable 62,500
Total Current Liabilities 62,500
Long-term Liabilities
Mortgage payable 479,500
Total Long-term Liabilities 479,500
Total Liabilities 542,000

Owners' equity, 12/31/06 313,000
Total Liabilities and Owners' equity 855,000

Income Statement Preparation

The following selected information is taken from the records of Beckstrom Corporation.

Accounts payable $35,000
Accounts ...

Solution Summary

This solution is comprised of a detailed answer for balance sheet, income statement, cash flows statement, and retained earnings statement preparations.

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