Question 1.
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Account Titles
|
Dr
|
Cr
|
|
Cash
|
$10,000
|
|
|
Accounts Receivable
|
21,500
|
|
|
Art Supplies
|
5,000
|
|
|
Prepaid Insurance
|
2,500
|
|
|
Printing Equipment
|
68,000
|
|
|
Accumulated Depreciation
|
|
$35,000
|
|
Accounts Payable
|
|
8,000
|
|
Interest Payable
|
|
150
|
|
Notes Payable
|
|
5,000
|
|
Unearned Advertising Revenue
|
|
5,600
|
|
Salaries Payable
|
|
1,300
|
|
Common Stock
|
|
10,000
|
|
Retained Earnings
|
|
3,500
|
|
Advertising Revenue
|
|
71,500
|
|
Salaries Expense
|
14,300
|
|
|
Insurance Expense
|
850
|
|
|
Interest Expense
|
500
|
|
|
Depreciation Expense
|
10,000
|
|
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Art Supplies Expense
|
3,400
|
|
|
Rent Expense
|
4,000
|
|
|
Total
|
$140,050
|
$140,050
|
|
Question 2.
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Administrative expense
|
|
|
|
|
Officers’ salaries
|
$5,900
|
|
|
Depreciation of equipment
|
3,960
|
|
Cost of Goods Sold
|
|
73,570
|
|
Rental revenue
|
|
20,230
|
|
Selling Expense
|
|
|
|
|
Transportation-out
|
5,690
|
|
|
Sales commission
|
7,980
|
|
|
Depreciation of equipment
|
6,480
|
|
Sales
|
|
116,500
|
|
Income tax
|
|
9,580
|
|
Interest expense
|
|
1,860
|
|
Question 3.
|
Current Assets
|
|
|
|
|
Cash
|
$350,000
|
|
|
Accounts Receivable (net)
|
340,000
|
|
|
Inventories at lower of average cost or market
|
401,000
|
|
|
Trading securities – at cost (fair value $120,000)
|
140,000
|
|
Property, plant and equipment
|
|
|
|
|
Building (net)
|
609,000
|
|
|
Office equipment (net)
|
160,000
|
|
|
Land held for future use
|
175,000
|
|
Intangible assets
|
|
|
|
|
Goodwill
|
80,000
|
|
|
Cash surrender value of life insurance
|
90,000
|
|
|
Prepaid expenses
|
12,000
|
|
Current liabilities
|
|
|
|
|
Accounts payable
|
155,000
|
|
|
Notes payable (due next year)
|
175,000
|
|
|
Pension obligation
|
102,000
|
|
|
Rent payable
|
49,000
|
|
|
Premium on bonds payable
|
53,000
|
|
Long-term liabilities
|
|
|
|
|
Bonds payable
|
550,000
|
|
Stockholders’ Equity
|
|
|
|
|
Common stock, $1.00 par, authorized
|
|
|
|
400,000 shares, issued 290,000
|
290,000
|
|
|
Additional paid-in capital
|
240,000
|
|
|
Retained earnings
|
?
|
|
|
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