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Income statements, expenses during year, inventory & merchandise.

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A. The income statement for the Racal Soliston Corporation shows prepaid rent of $12,000 at the beginning of the year and $5,000 at the end of the year. If rent expense for the year was $28,000, how much cash was paid out for rent during the year?

b. Assume that the cost of goods sold for Royal Scam Company for 2007 was $800,000. Inventory at the beginning of the year was $36,000 and at the end of the year was $140,000. If the accounts payable amount for merchandise purchases was $60,000 at the beginning of the year and $80,000 at the end of the year, what was the amount of cash paid to vendors during the year?

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Solution Summary

The expert examines income statements, expenses during year, and inventory and merchandise.

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