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ACC1002 -Wescott Company Balance Sheets

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Question;Wescott Company Balance Sheets At December 31Assets:Cash...................................................Accounts receivable, net............................Merchandise inventory..............................Prepaid expenses..................................... Equipment............................................. 280,600?Accumulated depreciation-Equipment............ Total assets..............................................Liabilities:Accounts payable.................................... Income taxes payable............................... Notes payable (long term)..........................Total liabilities.......................................... Equity:Share Capital........................................ Share Premium...................................... Retained earnings...................................Total equity............................................. Total liabilities and equity...........................(80,600) $522,280$ 52,850 15,240 59,200 $127,290200,000 53,000 141,990 $394,990 $522,28020112010$ 65,200 56,750 144,850 12,680 245,600(97,600) $427,480$ 45,450 12,240 79,200 $136,890150,000 40,000 100,590 $290,590 $427,480$ 488,000(368,200) 4,700124,500(41,100) $ 83,400$ 85,600 72,850 157,750 6,080Wescott CompanyIncome StatementFor Year Ended December 31, 2011?Sales................................................... Cost of goods sold............................ Depreciation expense.............................. Other operating expenses.....................Interest expense...................................Gain on sale of equipment............................... Income before taxes.................................... Income taxes expense...............................Net income............................................$212,540 43,000 106,260 6,400Additional information1. A $20,000 note payable is retired at its carrying amount in exchange for cash.2. The only changes affecting retained earnings are net income and cash dividends paid. Cash dividends paid is to be classified under financing activities.3. New equipment is acquired for $120,000 cash.4. Received cash for the sale of equipment that had cost $85,000, yielding a gain of $4,700. 5. Prepaid expenses relate to Other operating expenses on the income statement.6. Interest paid is to be classified under operating activities.

 

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