ACC3 M3S3
jayz1974
acc3_m3_s3.docxACC3 M3 S3
We’re continuing to analyze the same company as in assignment 1 and 2 with Nybrostrand.
Additional information added in assignment 2
· One client had indicated that they were interested in purchasing $42,500 worth of products. 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 the ending inventory was determined using a physical account.
Additional information for this assignment (Assignment 3)
· The company made a secondary offering of stock and raised an additional $180,000 which includes $150,000 of Paid-in Capital.
· The company had already paid $15,000 and dividends before deciding on the offering.
· The company now has cash to invest in a piece of raw land on which to build in the future. The investment takes place before year-end. The cost of the land is $400,000, the down payment is $40,000 and a note to the bank covers the rest.
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Nybrostrand Company |
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31-Dec-14 |
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Trial Balance (accounts in alphabetical order) |
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Debit |
Credit |
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Accounts payable |
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$ 78,000 |
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Accounts receivable |
$ 36,500 |
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Cash |
30,000 |
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Common stock |
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10,000 |
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Depreciation expense |
24,350 |
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Cost of goods sold |
307,000 |
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Equipment (net of depreciation) |
415,000 |
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Insurance |
1,400 |
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Inventory |
34,000 |
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Long-term debt |
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127,000 |
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Marketing |
4,500 |
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Paid-in capital |
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50,000 |
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Property taxes |
16,900 |
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Rent |
28,000 |
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Retained earnings |
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? |
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Revenues |
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586,000 |
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Salaries |
78,500 |
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Utilities |
6,700 |
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Total |
982,850 |
982,850 |
Assignment Expectations
Prepare a balance sheet for the company in good format. Update the balance sheet for the changes to income in module 2 and also consider the effect of paying the dividend. You do not need to include the income statement.
