Question

Expert Computers was started in 2018. The company experienced the following accounting events during his first year of operation 1. Started business when It acquired $75,000 cash from the issue of common stock 2. Purchased merchandise with a list price of $59,000 on account, terms 3/10, 1/30 3. Pald off one-half of the accounts payable balance within the discount period. 4. Sold merchandise on account for $47,900. Credit terms were 2/20, 1/30. The merchandise had cost Expert Computers $28,700. 5. Collected cash from the account receivable within the discount period. 6. Pald $9,100 cash for operating expenses. 7. Pald the balance due on accounts payable. The payment was not made within the discount period . Required a. Record the events in a horizontal statements model below. In the Cash Flows column, use the letters OA to designate operating activity, IA for Investing activity, FA for financing activity, or NC for net change in cash. If the account is not affected by the event, leave the cell blank. The first event is recorded as an example. b. What is the amount of gross margin for the period? What is the net income for the period? Complete this question by entering your answers in the tabs below. Required A Required B Record the events in a horizontal statements model below. In the Cash Flows column, use the letters OA to designate operating activity, IA for investing activity, FA for financing activty, or change in cash. If the account is not affected by the event, leave the cell blank. The first event is recorded as an example. (Not every cell will require entry. Enter any decreases to account and cash outflows with a minus sign.) EXPERT COMPUTERS Horizontal Statements Model for 2018 Liabilities Stockholders' Equity Income Statement Accounts Common Retained Revenue Net Expenses Stock Payable Earning Income 75.000 Assets Accounts + Inventory Receivable Statement of Cash Flow Event Cash 75.000 FA 75,000 1. 2 3 - - + + 4b + 75.000 7 End. Bal 0. 75,000 75.000 20 of 25 Next

Answer 1

+ Gross Margin Calculation Sales 47900 Less:Cost of good sold 2965828700+958 Gross Profit 18242 2 + T Assets Liabilities Stockholder' equity Income statement Statement of Cash Event Cash + Accounts Receivable Inventory Accounts Payable + Common stock + Retained Earnings Revenues - Expenses = Net Income flow 1 $ 75,000 + 75,000 $ 75,000 FA + $ 59,000 = $ 59,000 NA 3 $ -28.615 + $ -885 = $ -29,500 $ -28,615 OA 4 + $ 47,900 + $-28,700 $ 47,900 $ 47,900 $ 28,700 = $ 19,200 $ NA $ -28,700 46,942 $ -47,900 + $ -958 $ 958 $ -958$ 46,942 OA 6 $ -9,100 + + $ -9.100 $ 9,100 $ -9,100 $ -9,100 OA $ -29,500 $ -29,500 $ -29,500 OA Total $ 54,727 $ $ 29,415 $ 75,000 $ 9,142 $ 47,900 $38,758 $ 9.142 $ 54,727 + + + = + + + + = + Net Income Calculation Sales 47900 Less:Expenses 38758 28700+958+9100 Gross Profit 9142 ols