Q21E - Intermediate Accounting (Kieso)

Question

(L09) (Worksheet) Presented below are the selected accounts for Alvarez Company as reported in the worksheet at the end of May 2017.

 

ALVAREZ CO. Worksheet For The Month Ended May 31, 2017
	Adjusted  Trial Balance		Income  Statement		Balance  Sheet
Accounts Titles	Dr.	Cr.	Dr.	Cr.	Dr.	Cr.
Cash	9,000
Inventory	80,000
Sales Revenue		450,000
Sales returns and allowances	10,000
Sales Discounts	5,000
Cost of Goods Sold	250,000

Instructions:

Complete the worksheet by extending the amounts reported in the adjusted trial balance to the appropriate columns in the worksheet. Do not total individual columns.

Step-by-Step Solution

Answer

Cash (Balance sheet) =Dr.9,000 

Inventory (Balance sheet) = Dr.80,000

Sales Revenue (Income Statement) = Cr.450,000

Sales Returns and Allowances (Income Statement) = Dr. 10,000

Sales Discount (Income Statement) = Dr.5,000

Cost of Goods Sold (Income Statement) = Dr.250,000

Step 1: Meaning of Balance Sheet

The term balance sheet represents the financial position of a company using various resources, liabilities, and owner's equity. It shows all the items briefly for a better understanding of the financial position.

Step 2: Worksheet presentation

The worksheet for the month ended May 31, 2017, is as follows:

ALVAREZ CO. Worksheet For the Month Ended May 31, 2017
	Adjusted Trial balance		Income Statement		Balance Sheet
Account Titles	Dr.	Cr.	Dr.	Cr.	Dr.	Cr.
Cash	9,000	-------	------	-------	9,000	------
Inventory	80,000	-------	------	-------	80,000	------
Sales Revenue	------	450,000	------	450,000	-------	------
Sales Returns and Allowances	10,000	------	10,000	-------	-------	------
Sales Discount	5,000	------	5,000	-------	-------	------
Cost of Goods Sold	250,000	------	250,000	-------	-------	------

 

Note: Sales returns and allowances may also be shown as deductions from sales revenues.