70.2K

Verified Solution

Link Copied!

On January 1, 2021, the general ledger of Grand Finale Fireworks includes the following account balances: Accounts Cash Accounts Receivable Supplies Equipment Accumulated Depreciation Accounts Payable Common Stock, $1 par value Additional Paid-in Capital Retained Earnings Totals Debit Credit $ 42,700 44,500 7,500 64,000 $ 9,000 14,600 10,000 80,000 45, 100 $158,700 $158,700 During January 2021, the following transactions occur January 2 Issue an additional 2,000 shares of $1 par value cominon stock for $40,000. January 9 Provide services to customers on account, $14,300. January 10 Purchase additional supplies on account, $4,900. January 12 Purchase 1,000 shares of treasury stock for $18 per share. January 15 Pay cash on accounts payable, $16,500. January 21 Provide services to customers for cash, $49, 100. January 22 Receive cash on accounts receivable, $16,600. January 29 Declare a cash dividend of $0.30 per share to all shares outstanding on January 29. The dividend is payable on February 15. (Hint: Grand Finale Fireworks had 10,000 shares outstanding on January 1, 2021, and dividende are not paid on treasury stock.) January 30 Resell 600 shares of treasury stock for $20 por share. January 31 Pay cash for salaries during January, $42,000. The following information is available on January 31, 2021. a. Unpaid utilities for the month of January are $6,200. b. Supplies at the end of January total $5,100, c. Depreciation on the equipment for the month of January is calculated using the straightline method. At the time the equipment was purchased, the company estimated a service life of three years and a residual value of $10,000. d. Accrued income taxes at the end of January are $2,000. Requirement General Journal General Ledger Trial Balance Income Statement Balance Sheet Analysis Enter your Return on Equity value to one decimal place and earnings per share value to 2 decimal places. Analyze the following for Grand Finale Fireworks: (a) Calculate the return on equity for the month of January. If the average return on equity for the industry for January is 2.5%, is the company more or less profitable than other companies in the same industry? The return on equity is % Is the company more or less profitable than other companies? (b) How many shares of common stock are outstanding as of January 31, 2021? The number of common shares outstanding as of January 31, 2021 is (C) Calculate earnings per share for the month of January (Hint: To calculate average shares of common stock outstanding take the beginning shares outstanding plus the ending shares outstanding and divide the total by 2.) If earnings per share was $3.60 last year (ie, an average of $0.30 per month), is earnings per share for January 2021 better or worse than last year's average? Earings per share in is earnings per share for January 2021 botter or worse than last year's averago? Post-closing Grand Finale Fireworks Trial Balance January 31, 2021 Account Title Debit Credit $ 83,900 42,200 5,100 64,000 Cash Accounts Receivable Supplies Equipment Accumulated Depreciation Accounts Payable Utilities Payable Income Tax Payable Dividends Payable Common Stock Treasury Stock Additional Paid-in Capital Retained Earnings Total 10,500 3,000 6,200 6,400 3,300 12,000 7,200 119,200 41,800 202,400 IS 202,400 S (General Ledger Income Statement > Requirement General Journal General Ledger Trial Balance Income Statement Balance Sheet Analysis Choose the appropriate accounts to complete the company's balance sheet. Make sure to select 'adjusted' from which will then populate the balances in those accounts from the adjusted trial balance. Post-closing Grand Finale Fireworks Classified Balance Sheet January 31, 2021 Assets Liabilities Current Assets: $ $ Cash Accounts Receivable Supplies Current Liabilities: 83,900 Accounts Payable 42,200 Utilities Payable 5,100 Income Tax Payable Dividends Payable 3,000 6,200 6.4.90 3,300 12 131,200 18,900 Total Current Assets Noncurrent Assets: Equipment Accumulated Depreciation 64,000 (10,500) Total Current Liabilities Stockholders' Equity Common Stock Additional Paid-in Capital Treasury Stock Retained Earnings 12,000 119,200 (7.200) 41,800 Total Stockholders' Equity Total Liabilities & Stockholders' Equity 165,800 184.700 Total Assets $ 184,700 $

Answer & Explanation Solved by verified expert

See Answer