Rose Corporation began operations at the start of 2010.During 2010,it made cash and credit sales totaling $500,000 and collected $420,000 in cash from its customers.It purchased inventory costing $250,000,paid $15,000 for dividends and the cost of goods sold was $210,000.The corporation incurred the following expenses during 2010:
$$\begin{array} { l r }
\text { Salary expense } & \$ 80,000 \
\text { Interest expense } & 5,000 \
\text { Insurance expense } & 4,000 \
\text { Supplies expense } & 6,000 \
\text { Income tax expense } & 34,000
\end{array}$$ Requirements:
1.Prepare an income statement showing revenues,expenses,pretax income,income tax expense,and net income for the year ended December 31,2010.
2.Based on the above information,what is the amount of accounts receivable on the balance sheet prepared as of December 31,2010?
3.Based on the above information,what is the amount of retained earnings on the balance sheet prepared as of December 31,2010?

Question

Rose Corporation began operations at the start of 2010.During 2010,it made cash and credit sales totaling $500,000 and collected $420,000 in cash from its customers.It purchased inventory costing $250,000,paid $15,000 for dividends and the cost of goods sold was $210,000.The corporation incurred the following expenses during 2010:
 $$\begin{array} { l r } 
\text { Salary expense } & \$ 80,000 \
\text { Interest expense } & 5,000 \
\text { Insurance expense } & 4,000 \
\text { Supplies expense } & 6,000 \
\text { Income tax expense } & 34,000
\end{array}$$ Requirements:
1.Prepare an income statement showing revenues,expenses,pretax income,income tax expense,and net income for the year ended December 31,2010.
2.Based on the above information,what is the amount of accounts receivable on the balance sheet prepared as of December 31,2010?
3.Based on the above information,what is the amount of retained earnings on the balance sheet prepared as of December 31,2010?

Quizplus · Accepted Answer

The Answer of Rose Corporation began operations at the start of 2010.During 2010,it made cash and credit sales totaling $500,000 and collected $420,000 in cash from its customers.It purchased inventory costing $250,000,paid $15,000 for dividends and the cost of goods sold was $210,000.The corporation incurred the following expenses during 2010:
 $$\begin{array} { l r } 
\text { Salary expense } & \$ 80,000 \
\text { Interest expense } & 5,000 \
\text { Insurance expense } & 4,000 \
\text { Supplies expense } & 6,000 \
\text { Income tax expense } & 34,000
\end{array}$$ Requirements:
1.Prepare an income statement showing revenues,expenses,pretax income,income tax expense,and net income for the year ended December 31,2010.
2.Based on the above information,what is the amount of accounts receivable on the balance sheet prepared as of December 31,2010?
3.Based on the above information,what is the amount of retained earnings on the balance sheet prepared as of December 31,2010?

Rose Corporation Began Operations at the Start of 2010 Requirements: 1

Rose Corporation Began Operations at the Start of 2010 Requirements:
1