A company began operations at the start of Year 1.
During the year, it had cash sales of $50,000 and credit sales of $450,000. The company collected $420,000 in cash from the credit sales. The company purchased inventory costing $250,000 and paid $18,000 in dividends. The company incurred the following expenses:
| Cost of goods sold | 210,000 | Rent expense | 6,000 |
| Salary expense | 80,000 | Depreciation expense | 4,000 |
| Interest expense | 5,000 | Income tax expense | 57,000 |
Using this information, answer the following questions.
- What would Operating Income on the Dec. 31, Year 1 Income Statement be reported as?
- As of Dec. 31, Year 1, determine the ending balance in the Accounts Receivable
- Determine Ending Retained Earnings as of December 31, Year 1
The Rest Of TheVideos
| 1 | Not completed | Determining Normal Balances For Assets & Liabilities | 11 min |
| 2 | Not completed | Determining Normal Balance for Shareholder's Equity | 12 min |
| 3 | Not completed | Normal Balance Shortcut: Double Entry | 12 min |
| 4 | Not completed | Normal Balance Shortcut: DEAD Mnemonic | 3 min |
| 5 | Not completed | The Journal, Ledger, Trial Balance | 14 min |
| 6 | Not completed | The Multistep Income Statement | 13 min |
| 7 | Not completed | Gross Profit vs Net Profit | 7 min |
| 8 | Not completed | Profit Margin | 4 min |
Chapter 3Practice Problems
| Click Here to View All Problems at Once | View | ||
| 1 | Not completed | Account Classification | Easy |
| 2 | Not completed | Journal Entry - Inventory | Easy |
| 3 | Not completed | Journal Entry - Sales | Easy |
| 4 | Not completed | Land Purchased With Cash | Easy |
| 5 | Not completed | T/F: Liabilities and Equity | Easy |
| 6 | Not completed | Normal Balances | Moderate |
| 7 | Not completed | What Should Be Journaled | Moderate |
| 8 | Not completed | Calculating Operating Income You are here. | Hard |