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Scilla [17]
3 years ago
14

Wang Company began operations on January 1, 2018, by issuing common stock for $70,000 cash. During 2018, Wang received $88,000 c

ash from revenue and incurred costs that required $65,000 of cash payments.
Prepare a GAAP-based income statement and balance sheet for Wang Company for 2018, for the below scenario:

Wang is a manufacturing company. The $65,000 was paid to purchase the following items:

(1) Paid $10,000 cash to purchase materials that were used to make products during the year.

(2) Paid $20,000 cash for wages of factory workers who made products during the year.

(3) Paid $5,000 cash for salaries of sales and administrative employees.

(4) Paid $30,000 cash to purchase manufacturing equipment. The equipment was used solely to make products. It had a three-year life and a $6,000 salvage value. The company uses straight-line depreciation.

(5) During 2018, Wang started and completed 2,000 units of product. The revenue was earned when Wang sold 1,500 units of product to its customers.
Business
1 answer:
posledela3 years ago
3 0

Answer:

Wang Company

Statement of financial position

Equity and liabilities

Issued share capital  $70,000

Retained earnings     $45,000

                                   115,000

Assets

Non-Current assets

Fixed assets               $22,000

Current assets

Cash in hand               $93,000

                                     $115,000            

Wang company

Income statement

Net sales                      $88,000

Cost of sales                 $38,000

Gross margin                $50,000

Less:admin expenses   $5,000

Net Profit                       $45,0000

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1 year ago
6. Say whether the following words are (just) vague, (just) ambiguous, both vague and ambiguous, or neither. Briefly justify you
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Answer:

When something is vague, it is not being specific but when something is ambiguous, it has multiple meanings and so can be open to interpretation.

a. Middle class ⇒ Both VAGUE and AMBIGUOUS

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3 years ago
The straight-line depreciation method and the double-declining-balance depreciation method: Multiple Choice Are acceptable for t
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Answer:

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Produce the same total depreciation over an asset's useful life.

Explanation:

The straight-line and the double-declining-balance depreciation methods are two of the four depreciation methods allowed by US generally accepted accounting principles (GAAP).  The other two methods are sum of the years' digit and units of production.  The straight-line method is calculated by subtracting the salvage value from the asset's cost and either dividing the depreciable amount by the number of years or applying a fixed rate on the depreciable amount.  For the double-declining-balance method, 100% is divided by the number of years of the asset's useful life and then multiplying by 2 to obtain the depreciation rate.  Depreciation expense is then calculated on the declining balance until the salvage value is left.  This is why they produce the same depreciation over the asset's useful life.

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3 years ago
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Answer:

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