PROBLEM 5-3A

(a)

CUSICK DEPARTMENT STORE

Income Statement
For the Year Ended December 31, 2012

Sales revenues
Sales revenue ....................................
Less: Sales returns and
allowances ..............................
Net sales ............................................
Cost of goods sold ...................................
Gross profit...............................................
Operating expenses
Salaries and wages expense ....
Depreciation expense .................
Sales commissions expense .....
Utilities expense .........................
Insurance expense .....................
Property tax expense .................
Total operating expenses ....
Income from operations...........................
Other revenues and gains
Interest revenue .................................
Other expenses and losses
Interest expense ................................
Net income ................................................

Copyright 2011 John Wiley & Sons, Inc.

$728,000
8,000
720,000
412,700
307,300
$108,000
23,700
14,500
12,000
7,200
4,800

Weygandt, Accounting Principles, 10/e, Solutions Manual

170,200
137,100
4,000
12,000

8,000
$ 129,100

(For Instructor Use Only)

5-1

PROBLEM 5-3A (Continued)

CUSICK DEPARTMENT STORE
Owners Equity Statement
For the Year Ended December 31, 2012
Owners Capital, January 1 ...........................................................
Add: Net income ..........................................................................
Less: Drawings .............................................................................
Owners Capital, December 31 .....................................................

$176,600
129,100
305,700
28,000
$277,700

CUSICK DEPARTMENT STORE

Balance Sheet
December 31, 2012
Assets
Current assets
Cash ....................................................
Accounts receivable ...........................
Inventory .............................................
Prepaid insurance ...............................
Total current assets ....................
Property, plant, and equipment
Buildings .............................................
Less: Accumulated depreciation
buildings ..................................
Equipment ...........................................
Less: Accumulated depreciation
equipment ................................
Total assets .................................

$ 23,800
50,300
75,000
2,400
$151,500
$290,000
52,500
110,000

237,500

42,900

67,100

304,600
$456,100

PROBLEM 5-3A (Continued)

CUSICK DEPARTMENT STORE
Balance Sheet (Continued)
December 31, 2012
Liabilities and Owners Equity
Current liabilities
Accounts payable ..................................................... $ 80,300
Mortgage payable (due next year) ...........................
25,000
Interest payable ........................................................
9,000
Property taxes payable.............................................
4,800
Sales commissions payable ....................................
4,300
Total current liabilities ......................................
$123,400
Long-term liabilities
Mortgage payable .....................................................
55,000
Total liabilities ...................................................
178,400
Owners equity
Owners capital .........................................................
277,700
Total liabilities and owners equity ..................
$456,100

(b) Dec. 31

31
31
31

Depreciation Expense .............................

Accumulated Depreciation
Buildings ......................................
Accumulated Depreciation
Equipment ....................................

23,700

Insurance Expense ..................................

Prepaid Insurance ............................

7,200

Interest Expense ......................................

Interest Payable ...............................

9,000

Property Tax Expense .............................

Property Taxes Payable...................

4,800

Copyright 2011 John Wiley & Sons, Inc.

Weygandt, Accounting Principles, 10/e, Solutions Manual

10,400
13,300
7,200
9,000
4,800

(For Instructor Use Only)

5-3

PROBLEM 5-3A (Continued)

31
31
(c) Dec. 31

31

31
31

Sales Commissions Expense ...............

Sales Commissions Payable .........

4,300

Utilities Expense ....................................

Accounts Payable ..........................

1,000

Sales Revenue ......................................

Interest Revenue ...................................
Income Summary ..........................

728,000
4,000

Income Summary ..................................

Sales Returns and Allowances ......
Cost of Goods Sold .......................
Salaries and Wages Expense .......
Sales Commissions Expense .......
Property Tax Expense ..................
Utilities Expense ...........................
Depreciation Expense ...................
Insurance Expense .......................
Interest Expense ...........................

602,900

Income Summary ..................................

Owners Capital .............................

129,100

Owners, Capital....................................
Owners Drawings .........................

28,000

4,300
1,000

732,000
8,000
412,700
108,000
14,500
4,800
12,000
23,700
7,200
12,000
129,100
28,000

Copyright 2011 John Wiley & Sons, Inc.

Weygandt, Accounting Principles, 10/e, Solutions Manual

(For Instructor Use Only)

5-5

(a)

MR. EKO FASHION CENTER

Worksheet
For the Year Ended November 30, 2012
Account Titles

Trial Balance

Dr.

Cr.

Dr.

Cr.

8,700
30,700
44,700
6,200
133,000
28,000
51,000
48,500
90,000

(d)
(a)

300
4,200

(b)

11,500

12,000

Dr.

Cr.

Income
Statement

Dr.

Cr.

8,700
30,700
44,400
2,000
133,000

39,500
51,000
48,500
90,000
12,000

755,200

755,200

8,800
497,700

8,800
497,700

140,000
24,400
14,000

140,000
24,400
14,000

140,000
24,400
14,000

12,100
16,700
24,000
972,700

12,100
16,700
24,000

12,100
16,700
24,000

4,200
11,500
4,000

4,200
11,500
4,000

300

Cr.

8,700
30,700
44,400
2,000
133,000

12,000

(d)

Dr.

39,500
51,000
48,500
90,000

755,200
8,800
497,400

Balance Sheet

972,700
(a)
(b)
(c)

4,200
11,500
4,000
(c)
20,000

4,000
20,000

988,200

4,000
988,200

757,400
757,400

755,200
2,200
757,400

230,800
2,200
233,000

Key: (a) Store supplies used, (b) Depreciation expenseequipment, (c) Accrued interest payable, (d) Adjustment of inventory.

4,000
233,000
233,000

*PROBLEM 5-8A

Cash
Accounts Receivable
Inventory
Supplies
Equipment
Accum. Depreciation
Equipment
Notes Payable
Accounts Payable
Owners Capital
Owners Drawings
Sales Revenue
Sales Returns and
Allowances
Cost of Goods Sold
Salaries and Wages
Expense
Advertising Expense
Utilities Expense
Maintenance and Repairs
Expense
Freight-out
Rent Expense
Totals
Supplies Expense
Depreciation Expense
Interest Expense
Interest Payable
Totals
Net Loss
Totals

Adjusted
Trial Balance

Adjustments

*PROBLEM 5-8A (Continued)

(b)

MR. EKO FASHION CENTER

Income Statement
For the Year Ended November 30, 2012

Sales revenues
Sales revenue .............................................
Less: Sales returns and
allowances .......................................
Net sales .....................................................
Cost of goods sold ............................................
Gross profit........................................................
Operating expenses
Salaries and wages expense ..............
Advertising expense............................
Rent expense .......................................
Freight-out ...........................................
Utilities expense ..................................
Maintenance and repairs expense......
Depreciation expense .........................
Supplies expense ................................
Total operating expenses .............
Income from operations....................................
Other expenses and losses
Interest expense .........................................
Net loss ..............................................................

Copyright 2011 John Wiley & Sons, Inc.

$755,200
8,800
746,400
497,700
248,700
$140,000
24,400
24,000
16,700
14,000
12,100
11,500
4,200

Weygandt, Accounting Principles, 10/e, Solutions Manual

246,900
1,800
$

4,000
(2,200)

(For Instructor Use Only)

5-7

*PROBLEM 5-8A (Continued)

MR. EKO FASHION CENTER
Owners Equity Statement
For the Year Ended November 30, 2012
Owners Capital, December 1, 2011 ..........................
Less: Net loss ............................................................
Drawings ..........................................................
Owners Capital, November 30, 2012 ........................

$90,000
$ 2,200
12,000

14,200
$ 75,800

MR. EKO FASHION CENTER

Balance Sheet
November 30, 2012
Assets
Current assets
Cash ..................................................
Accounts receivable ........................
Inventory ..........................................
Supplies ............................................
Total current assets .................
Property, plant, and equipment
Equipment ........................................
Accumulated depreciation
equipment.....................................
Total assets ..............................

5-8

Copyright 2011 John Wiley & Sons, Inc.

8,700
30,700
44,400
2,000
$ 85,800

$133,000
39,500

Weygandt, Accounting Principles, 10/e, Solutions Manual

93,500
$179,300

(For Instructor Use Only)

*PROBLEM 5-8A (Continued)

MR. EKO FASHION CENTER
Balance Sheet (Continued)
November 30, 2012
Liabilities and Owners Equity
Current liabilities
Notes payable (due next year) .................................
Accounts payable .....................................................
Interest payable ........................................................
Total current liabilities ......................................
Long-term liabilities
Notes payable ...........................................................
Total liabilities ...................................................
Owners equity
Owners capital .........................................................
Total liabilities and owners equity ..................

(c) Nov. 30
30

30
30

$20,000
48,500
4,000
$ 72,500
31,000
103,500
75,800
$179,300

Supplies Expense.....................................
Supplies ............................................

4,200

Depreciation Expense ..............................

Accumulated Depreciation
Equipment .....................................

11,500

Interest Expense ......................................

Interest Payable ................................

4,000

Cost of Goods Sold ..................................

Inventory ...........................................

300

Copyright 2011 John Wiley & Sons, Inc.

Weygandt, Accounting Principles, 10/e, Solutions Manual

4,200

11,500
4,000
300

(For Instructor Use Only)

5-9

*PROBLEM 5-8A (Continued)

(d) Nov. 30
30

30
30

5-10

Sales Revenue ......................................

Income Summary ..........................

755,200

Income Summary .................................

Sales Returns and
Allowances ................................
Cost of Goods Sold ......................
Salaries and Wages Expense .......
Advertising Expense ....................
Utilities Expense ...........................
Maintenance and Repairs
Expense .....................................
Freight-out .....................................
Rent Expense ................................
Supplies Expense .........................
Depreciation Expense ..................
Interest Expense ...........................

757,400

Owners Capital ....................................

Income Summary ..........................

2,200

Owners Capital ....................................

Owners Drawings.........................

12,000

Copyright 2011 John Wiley & Sons, Inc.

755,200

8,800
497,700
140,000
24,400
14,000
12,100
16,700
24,000
4,200
11,500
4,000
2,200

Weygandt, Accounting Principles, 10/e, Solutions Manual

12,000

(For Instructor Use Only)

PROBLEM 5-3B

(a)

THE AKINNUOYE STORE

Income Statement
For the Year Ended November 30, 2012

Sales revenues
Sales revenue ....................................
Less: Sales returns & allowances ...
Net sales ............................................
Cost of goods sold ...................................
Gross profit...............................................
Operating expenses
Salaries and wages expense .....
Rent expense ..............................
Sales commissions expense .....
Depreciation expense ................
Utilities expense .........................
Insurance expense .....................
Freight-out ..................................
Property tax expense .................
Total oper. expenses ...........
Income from operations...........................
Other revenues and gains
Interest revenue .................................
Other expenses and losses
Interest expense ................................
Net income ................................................

Copyright 2011 John Wiley & Sons, Inc.

Weygandt, Accounting Principles, 10/e, Solutions Manual

$700,000
8,000
692,000
507,000
185,000
$96,000
15,000
11,000
11,000
8,500
7,000
6,500
2,500
157,500
27,500
8,000
6,400

1,600
$ 29,100

(For Instructor Use Only)

5-11

PROBLEM 5-3B (Continued)

THE AKINNUOYE STORE
Owners Equity Statement
For the Year Ended November 30, 2012
Owners Capital, December 1, 2011 ...............................................
Add: Net income ............................................................................
Less: Drawings ...............................................................................
Owners Capital, November 30, 2012 .............................................

$101,700
29,100
130,800
10,000
$120,800

THE AKINNUOYE STORE

Balance Sheet
November 30, 2012
Assets
Current assets
Cash ...................................................
Accounts receivable .........................
Inventory ...........................................
Prepaid insurance .............................
Total current assets ..................
Property, plant, and equipment
Equipment .........................................
Less: Accumulated depreciation
equipment ..............................

$ 26,000
30,500
29,000
3,500
$ 89,000
$146,000
45,000

Total assets ...............................

5-12

Copyright 2011 John Wiley & Sons, Inc.

Weygandt, Accounting Principles, 10/e, Solutions Manual

101,000
$190,000

(For Instructor Use Only)

PROBLEM 5-3B (Continued)

THE AKINNUOYE STORE
Balance Sheet (Continued)
November 30, 2012
Liabilities and Owners Equity
Current liabilities
Accounts payable ......................................................
Sales commissions payable .....................................
Property taxes payable..............................................
Total current liabilities .......................................
Long-term liabilities
Notes payable ............................................................
Total liabilities ....................................................
Owners equity
Owners capital ..........................................................
Total liabilities and owners equity ...................

(b) Nov. 30

$25,200
4,500
2,500
$ 32,200
37,000
69,200
120,800
$190,000

Depreciation Expense ..............................

Accumulated Depreciation
Equipment .....................................

11,000

Insurance Expense...................................
Prepaid Insurance.............................

7,000

Property Tax Expense ..............................

Property Taxes Payable ...................

2,500

Sales Commissions Expense ..................

Sales Commissions Payable ...........

4,500

Copyright 2011 John Wiley & Sons, Inc.

Weygandt, Accounting Principles, 10/e, Solutions Manual

11,000
7,000
2,500
4,500

(For Instructor Use Only)

5-13

PROBLEM 5-3B (Continued)

(c) Nov. 30

30

30
30

5-14

Sales Revenue ........................................

Interest Revenue ....................................
Income Summary ............................

700,000
8,000

Income Summary ...................................

Sales Returns and
Allowances ..................................
Cost of Goods Sold ........................
Salaries and Wages Expense .........
Depreciation Expense ....................
Freight-out .......................................
Sales Commissions Expense ........
Insurance Expense .........................
Rent Expense ..................................
Property Tax Expense ....................
Utilities Expense .............................
Interest Expense .............................

678,900

Income Summary ...................................

Owners Capital ...............................

29,100

Owners Capital ......................................

Owners Drawings...........................

10,000

Copyright 2011 John Wiley & Sons, Inc.

708,000

8,000
507,000
96,000
11,000
6,500
11,000
7,000
15,000
2,500
8,500
6,400
29,100

Weygandt, Accounting Principles, 10/e, Solutions Manual

10,000

(For Instructor Use Only)