Homework SoursePowell Company began the 2018 accounting period with 43000 c
Powell Company began the 2018 accounting period with $43,000 cash, $89,000 inventory, $63,000 common stock, and $69,000 retained earnings. During 2018, Powell experienced the following events: Sold merchandise costing $59,500 for $102,500 on account to Prentise Furniture Store. Delivered the goods to Prentise under terms FOB destination. Freight costs were $1,000 cash. Received returned goods from Prentise. The goods cost Powell $4,300 and were sold to Prentise for $5,400. Granted Prentise a $3,300 allowance for damaged goods that Prentise agreed to keep. Collected partial payment of $83,500 cash from accounts receivable.
Record the events in a statements model shown below.
Prepare an income statement, a balance sheet, and a statement of cash flows. Why would Prentise agree to keep the damaged goods?
10 Record the events in a statements model shown below. (Enter any decreases to account balances and cash outflows with a minus to designate operating activity, IA for investing activity, FA for financing activity, and NA for no affect.) Assets Accounts Event No. POWELL COMPANY Financial Statements Model for 2018 = Stockholders\' Equity Income Statement Common Retained Net Revenue - Expenses Stock Earnings Income 89,000 = 63,000 + 69,000 Statement of Cash Flows points Cash + Receivable + Inventory = X 01:15:36 Bal. 43,000 + 1a. 1b. + eBook + + 11111111111 + + + + + 43,000 + Total 0 + 63,000 + 89,000 = 69,000 Prey 19 of 14 Next >Solution
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5. Can resell the damaged goods which will have a lower cost due to the allowance received.
| POWELLL COMPANY | ||||||||||||||||
| Financial Statements Model for 2018 | ||||||||||||||||
| Assets | Stockholsrs\' Equity | Income Statement | Statement of cash flows | |||||||||||||
| Event No. | Cash | + | Accounts Receivable | + | Inventory | = | Common stock | + | Retained Earnings | Revenue | - | Expenses | = | Net Income | ||
| Bal | 43000 | + | + | 89000 | = | 63000 | + | 69000 | - | = | ||||||
| 1a | + | 102500 | + | = | + | 102500 | 102500 | - | = | 102500 | ||||||
| 1b | + | + | -69500 | = | + | -69500 | - | 69500 | = | -69500 | ||||||
| 2 | -1000 | + | + | = | + | -1000 | - | 1000 | = | -1000 | -1000 | Operating Activity | ||||
| 3a | + | -5400 | + | = | + | -5400 | -5400 | - | = | -5400 | ||||||
| 3b | + | + | 4300 | = | + | 4300 | - | -4300 | = | 4300 | ||||||
| 4 | + | -3300 | + | = | + | -3300 | -3300 | - | = | -3300 | ||||||
| 5 | 83500 | + | -83500 | + | = | + | - | = | 83500 | Operating Activity | ||||||
| Total | 125500 | + | 10300 | + | 23800 | = | 63000 | + | 96600 | 93800 | - | 66200 | = | 27600 | 82500 | |
| 159600 | = | 159600 | 27600 | = | 27600 |
