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Results for $2022$

Sales

$$281,800$ All sales on credit

Inventory Purchases on credit $=191,400$ and ending inventory $$56200($you calculate COGS$)$

Depreciation expense $ $16,000$ not including assets sold, bought or found

Patent purchased in $2018$ and determined to have remaining useful life of $10$ years in $2022$

Wages Expense $ $$27,450$ Paid in cash $2,194$ additional owed at end of $2022-$ this should be the amount in the payable

Insurance policy indicates that $$5,700$ was paid in May $2021$ for $24$ month coverage starting May $12021.$

During $2022$ found an asset purchased and recorded in $2019$ that had not been depreciated $-$ cost $6,830$ no salvage $10$ year useful life $($an error.

Sold AFS Debt Securities that cost $400$ for $390$ in cash $($ $$7$ loss in AOCI recorded previously$)$

Sold equipment that cost $3,000$ with accumulated depreciation of $2,590$ for $$300$ in cash.

Purchased new equipment costing $$6,975$ with $$2,000$ down payment and $10\%$ note payable on December $1,2021($first payment due January $1,2022$ ;

$10$ year useful life and no salvage

Collections on $\frac{A}{R}=278,320$

Payments on $\frac{A}{P}=176,500-$ all accounts payable deal with inventory

All service agreements sold to customers in $2021$ completed in $2022.$ New service agreements sold for $$2460$ in cash during $2022-40$ percent of the services provided

during $2022$

Bond terms$-$ interest onlv for $6\mathrm{.}5\%$ paid annually on September $1.$ Firm agreement with a bank signed on December $15$ to refinance bond to a $5$ year note in $202$:

Note Payable $-4$ payments of $$3,300$ made March $30,$ June $30,$ Sept $30$ and December $31$ interest of $8\%$ per year $(2\%$ per quarter$)$

Each note payment pays the interest since the last payment with any remaining amount going toward principle

Fair value of remaining AS Debt Securities $$1,400$

Other Information

Tax rate is $21\%($unlike $2021$ income taxes have not been paid and need to be recorded$)$

Half year convention for depreciation

Required:

$1.$ Show journal entries or T accounts for results of $2022$ operations.

$2.$ Create an income statement including taxes and required EPS disclosures for $2022.$

$3.$ Create a statement of comprehensive income for $2022$

$4.$ Create a statement of changes in stockholders equity for $2022$

$5.$ Create a balance sheet for the end of $2022.$

$6.$ Create a cash flow statement for $2022$ using the indirect method.

$7.$ Show any necessary disclosures for $2021$ that would be needed if both $2021$ and $2022$ were to be reported

Answer & Explanation Solved by verified expert

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