WileyPLUS nhighered.com ×Home e secure https://edugen.wileyplus.com/edugenntirmain.uni Kimmel, Accounting, 6e Exercise 1-9 Here are incomplete financial statements for Donavan, Inc. Calculate the missing amounts T RESOURCES DONAVAN, INC. Balance Sheet rcise 1-9 $7,000 10,000 Cash 1-11 Buildings Total assets $62,000 1-3 2-1 2-5 Liabilities and Stockholders\' Equity 5,000 Accounts payable Common stock Retained earnings ore Stockholders\' Equity Total liabilities and stockholders\' equity $62,000 DONAVAN, INC. $85,000 Cost of goods sold Salaries and wages 10,000 Net Income DONAVAN, INC Retained Earnings Statement Beginning retained Add: Net income Less: Dividends $12,000
Calculation of missing amounts DONAVAN INC. Balance Sheet Assets Cash $7,000 Inventory $10,000 Buildings $45,000 Total Assets $62,000 Liabilities and Stockholders Equity Liabilities Accounts Payable $5,000 Stockholders Equity Common stock $30,000 a Retained Earnings $27,000 b Total Liabilities and Equity $62,000 DONAVAN INC. Income Statement Revenues $85,000 Cost of goods sold $55,000 c Salaries and Wages Expense $10,000 Net Income $20,000 d DONAVAN INC. Retained Earnings Statement Beginning retained Earnings $12,000 Add : Net Income $20,000 e Less : Dividends $5,000 Ending Retained Earnings $27,000 (e) and (d) = Net Income = Ending Retained Earnings + Dividend - Beginning retained earnings = $27000+$5000 - $12000 = $20000 ( c ) Cost of goods sold = Revenues - Salaries and wages - net income = $85000 - $10000 - $20000 = $55000 (a) Common stock = Total liabilities and equity - Retained Earnings - Accounts Payable = $62000 - $27000 - $5000 = $30000
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