We are using the same company as in the first
Module. However, you need to consider some additional information.
One client indicated
that they were interested in purchasing $42,500 worth of products, so the
bookkeeper recorded the transaction. However, the client has not actually
committed to the purchase.The bookkeeper already
corrected the sales account. However, the bookkeeper may have made a mistake
when computing cost of goods sold. She included total production costs for 2014
and did not adjust ending inventory for the $42,500 worth of units left at the
end of the year. The amount of ending inventory was determined using a physical
count.
Nybrostrand Company
31-Dec-14
Trial Balance (accounts in alphabetical
order)
Debit
Credit
Accounts payable
$ 78,000
Accounts receivable
$ 36,500
Cash
30,000
Common stock
10,000
Depreciation expense
24,350
Cost of goods sold
307,000
Equipment (net of depreciation)
415,000
Insurance
1,400
Inventory
34,000
Long-term debt
127,000
Marketing
4,500
Paid-in capital
50,000
Property taxes
16,900
Rent
28,000
Retained earnings
?
Revenues
586,000
Salaries
78,500
Utilities
6,700
Total
982,850
982,850
SLP
Assignment ExpectationsPrepare an income
statement for the company in good format. Always include the name of the
company and the period covered in the title. Don’t forget dollar signs where
appropriate. You do not need to include the balance sheet. Consequently, you
will not need all the accounts listed above. How does the income or loss
compare to the original income statement? Explain the importance of the
matching concept. The submission should
be 2- to 4-pages and needs to include answers to all the questions listed
above. Show computations, discuss the results, and include references in APA
format.
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