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Jets Corporation is a private corporation using ASPE. At December 31, 2019, an analysis of the accounts and discussions with company officials included the following account balances and other information:
Accounts receivable........................................................................................... $ 102,000
Accrued interest payable.................................................................................... 1,000
Dividend revenue............................................................................................... 9,000
Sales.................................................................................................................... 600,000
Purchase discounts............................................................................................. 9,000
Purchases............................................................................................................ 360,000
Accounts payable............................................................................................... 30,000
Loss from fire (net of $7,000 tax)...................................................................... 21,000
Selling expenses................................................................................................. 64,000
Common shares (20,000 issued; no change during 2020).................................. 200,000
Accumulated depreciation.................................................................................. 90,000
Long-term note payable (due Oct 1, 2024)........................................................ 100,000
Inventory, Jan 1, 2020........................................................................................ 76,000
Inventory, Dec 31, 2020..................................................................................... 62,500
Supplies inventory.............................................................................................. 40,000
Unearned service revenue.................................................................................. 3,000
Land.................................................................................................................... 370,000
Cash.................................................................................................................... 60,000
Franchise............................................................................................................ 100,000
Retained earnings, Jan 1, 2020........................................................................... 135,000
Interest expense.................................................................................................. 8,500
Cumulative before tax impact on income due to change from
straight-line to accelerated depreciation............................................................ (24,000)
General and administrative expenses................................................................. 80,000
Dividends declared and paid.............................................................................. 15,000
Allowance for doubtful accounts....................................................................... 5,000
Machinery and equipment.................................................................................. 225,000
When applicable, you may assume a 25% income tax rate. General and administrative expenses include depreciation. There are no preferred shares issued.
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