Question

Complete the comparative income statement and balance sheet for Logic Company. (Input all answers as positive values except decrease answers which should be indicated by a minus sign. Round your "percent" answers to the nearest hundredth percent.)

LOGIC COMPANY Comparative Income Statement For Years Ended December 31, 2016 and 2017
					INCREASE (DECREASE)
	2017		2016		Amount	Percent
Gross sales	$	23,800	$	18,600	$
Sales returns and allowances		1,000		100
Net sales	$	22,800	$	18,500	$
Cost of merchandise (goods) sold		10,800		7,200
Gross profit	$	12,000	$	11,300	$
Operating expenses:
Depreciation	$	1,180	$	840	$
Selling and administrative		5,800		4,400
Research		1,030		740
Miscellaneous		840		540
Total operating expenses	$	8,850	$	6,520	$
Income before interest and taxes	$	3,150	$	4,780	$
Interest expense		1,040		740
Income before taxes	$	2,110	$	4,040	$
Provision for taxes		844		1,616
Net income	$	1,266	$	2,424	$

LOGIC COMPANY Comparative Balance Sheet December 31, 2016 and 2017
	2017			2016
	Amount		Percent	Amount		Percent
Assets
Current assets:
Cash	$	11,100		$	8,100
Accounts receivable		15,600			11,600
Merchandise inventory		7,600			13,100
Prepaid expenses		23,100			9,100
Total current assets	$	57,400		$	41,900
Plant and equipment:
Building (net)	$	13,600		$	10,200
Land		12,600			8,100
Total plant and equipment	$	26,200		$	18,300
Total assets	$	83,600		$	60,200
Liabilities
Current liabilities:
Accounts payable	$	12,100		$	6,100
Salaries payable		6,100			4,100
Total current liabilities	$	18,200		$	10,200
Long-term liabilities:
Mortgage note payable		21,100			19,600
Total liabilities	$	39,300		$	29,800
Stockholders’ Equity
Common stock	$	20,100		$	20,100
Retained earnings		24,200			10,300
Total stockholders’ equity	$	44,300		$	30,400
Total liabilities and stockholders’ equity	$	83,600		$	60,200

Answer 1

Answer:

LOGIC COMPANY
Comparative Income Statement
For Years Ended December 31, 2016 and 2017
			INCREASE (DECREASE)
	2017	2016	Amount	Percent
Gross sales	23,800	18,600	5,200	27.96%
Sales returns and allowances	1,000	100	900	900.00%
Net sales	22,800	18,500	4,300	23.24%
Cost of merchandise (goods) sold	10,800	7,200	3,600	50.00%
Gross profit	12,000	11,300	700	6.19%
Operating expenses:
Depreciation	1,180	840	340	40.48%
Selling and administrative	5,800	4,400	1,400	31.82%
Research	1,030	740	290	39.19%
Miscellaneous	840	540	300	55.56%
Total operating expenses	8,850	6,520	2,330	35.74%
Income before interest and taxes	3,150	4,780	-1,630	-34.10%
Interest expense	1,040	740	300	40.54%
Income before taxes	2,110	4,040	-1,930	-47.77%
Provision for taxes	844	1,616	-772	-47.77%
Net income	1,266	2,424	-1,158	-47.77%

2

LOGIC COMPANY
Comparative Balance Sheet
December 31, 2016 and 2017
	2017		2016
	Amount	Percent	Amount	Percent
Assets
Current assets:
Cash	11,100	13.28%	8,100	13.46%
Accounts receivable	15,600	18.66%	11,600	19.27%
Merchandise inventory	7,600	9.09%	13,100	21.76%
Prepaid expenses	23,100	27.63%	9,100	15.12%
Total current assets	57,400	68.66%	41,900	69.60%
Plant and equipment:
Building (net)	13,600	16.27%	10,200	16.94%
Land	12,600	15.07%	8,100	13.46%
Total plant and equipment	26,200	31.34%	18,300	30.40%
Total assets	83,600	100.00%	60,200	100.00%
Liabilities
Current liabilities:
Accounts payable	12,100	14.47%	6,100	10.13%
Salaries payable	6,100	7.30%	4,100	6.81%
Total current liabilities	18,200	21.77%	10,200	16.94%
Long-term liabilities:
Mortgage note payable	21,100	25.24%	19,600	32.56%
Total liabilities	39,300	47.01%	29,800	49.50%
Stockholders’ Equity
Common stock	20,100	24.04%	20,100	33.39%
Retained earnings	24,200	28.95%	10,300	17.11%
Total stockholders’ equity	44,300	52.99%	30,400	50.50%
Total liabilities and stockholders’ equity	83,600	100.00%	60,200	100.00%

Working notes for the above answer is as under

Balancesheet