final course project
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finalcourseproject.docxBalance Sheet and Single-Step Income Statement
Objective
The objective is to test student skills in using the given financial data to prepare a comprehensive balance sheet and multi-step income statement in good form .The given financial data will be comprised of all the various subgroupings that are reported in a multi-step income statement and balance sheet (operating revenues and expenses, other revenues and expenses and irregular items, current assets, investment, fixed assets, intangibles, current liabilities, long-term liabilities, and the equity sections).
Guideline
· Read the given financial data of New York Traders Inc.
· Determine which accounts belong to the balance sheet and which accounts belong to the income statement.
· Determine to which subgroup of balance sheet or income statement each account belongs.
· Compute the correct account balances that should be reported in balance sheet and correct amounts of revenues and expenses that should be reported in income statement.
· Arrange the accounts in proper order and functionality.
· Prepare a comprehensive balance sheet in good form.
· Prepare a multi-step income statement in good form.
· Submit the Course Project in Week 7.
Grading Rubric
|
Category |
Points |
% |
Description |
|
Making proper selection of accounts relative to the balance sheet or the income statement |
15 |
10 |
From the provided listing of accounts, determine which accounts are balance sheet accounts and which accounts are income statement accounts. |
|
Putting the accounts into the proper subgroup according to functionality |
15 |
10 |
Each account belongs to a particular subgroup. The student is to determine to which subgroup the account belongs. This should be done according to functionality. |
|
Prepare the balance sheet in good form with correct amount of financial items. |
60 |
40 |
Proper form is important in the preparation of the balance sheet. Examples can be found in the text. |
|
Prepare the income statement in good form with correct amount of financial items. |
45 |
30 |
Proper form is important in the preparation of the income statement. Examples can be found in the text. |
|
Showing full work of computation to arrive at the correct amount of financial items |
15 |
10 |
A quality paper will meet or exceed all of the above requirements. |
|
Total |
150 |
100 |
|
Financial Data of New York Traders Inc. as of January 1, 2016
|
Accounts Payable |
200,500 |
|
Account Receivable |
165,700 |
|
Accumulated Depreciations |
350,000 |
|
Additional Paid-In Capital |
40,000 |
|
Allowance for Doubtful Accounts |
2,650 |
|
Building and Equipment |
1,120,000 |
|
Cash |
45,300 |
|
Common Stock |
544,850 |
|
Copyrights |
112,000 |
|
Customer Deposits (expected to be paid in 2017) |
375 |
|
Goodwill |
225,000 |
|
Income Taxes Payable |
42,340 |
|
Inventories @ $25/unit |
315,250 |
|
Long-term Investments in Warren Co. |
95,630 |
|
Deposits With Vendors |
47,200 |
|
Land |
125,000 |
|
Mortgage Payable ($2,780 per month) |
667,200 |
|
2% Notes Payable to Banks ( due 2017) |
26,000 |
|
Notes Receivable (due 2017) |
16,000 |
|
Patents |
219,335 |
|
Retained Earnings |
127,500 |
|
Trademarks |
115,000 |
|
Twenty-year, 12% Bonds, Due 1/1/2020 |
600,000 |
|
Deposts with Vendors |
47,200 |
Financial Data of New York Traders Inc. for the Year 2016
|
1 |
Finished Goods inventory purchased from suppliers on account. 2/10/2016 10,000 units @ $26 each 6/12/2016 15,000 units @ $28 each 10/23/2016 12,000 units @ $29 each 11/25/2016 8,000 units @ $30 each New York Traders Inc. uses periodic inventory system and LIFO costing method. All purchases and sales are made on account. |
|
2 |
Payments made to suppliers on account during 2016 are $1,124,450. |
|
3 |
Sales made to customers on account are 49,356 units @ $36 each |
|
4 |
Cash collected from customers during 2016 is $1,750,700 |
|
5 |
Total Interest paid on Notes Payable and Bonds Payable amounted to $17,415 |
|
6 |
Rental Income on property leased out $ 25,650 |
|
7 |
New York Traders Inc. was operating a retail store at Chicago. Original cost of building and equipment was $120,000 with a book value of $95,000. During 2016 New York Traders disposed of this store at a loss of $35,800. |
|
8 |
New York Traders Inc. wants to make an allowance for doubtful debts at 2% on accounts receivable for the year 2016. |
|
9 |
Selling and Administrative expenses are $128,475. These expenses include $56,000 depreciation expense on Building and Equipment but exclude bad debts expenses. |
|
10 |
Income Tax Expense paid is $90,500. New York Traders Income Tax Rate for 2016 is 30% |
