Case Study Chemalite Inc
Enviado por Miajdiaz • 8 de Abril de 2013 • 446 Palabras (2 Páginas) • 3.436 Visitas
Question #1
Record each transaction in general journal format for the six month period ended June 30, 2003. Make sure that you document any assumptions made.
Entry No. Accounts Title Amount Debited Amount Credited
1 Cash
Patent
Shareholder’s Equity $375,000
$125,000
$500,000
2 Incorporation Expenses
Cash $7,500
$7,500
3 Property, Plant and Equipment
Cash $62,500
$62,500
4 Inventory
Cash $75,000
$75,000
*Incorporations Expenses are legal fees, charters cost and printing expenses.
Question #2
Prepare a general ledger using the T accounts format discussed in class based on the journal entries for the six month period ended June 30, 2003.
Cash (A)
1 $375,000
2 $7,500
3 $62,500
4 $75,000
$230,000
Patent (A)
1 $125,000
$125,000
Incorporation Expense
2 $7,500
$7,500
PP & E (A)
3 $62,500
$62,500
Inventory (A)
4 $75,000
$75,000
Shareholder’s Equity (SE)
1 $500,000
$500,000
Question #3
Prepare a Balance Sheet, Income Statement and Statement of Cash Flows for the six month
period ended June 30, 2003.
Chemalite, Inc.
Balance Sheet from January 1, 2003 to June 30, 2003
Assets
Current Assets
Cash $230,000
Inventory $75,000
Total current assets $305,000
Fixed Assets
Equipment $62,500
Patent $125,000
Total fixed assets $187,500
Total assets $492,500
Liabilities and Shareholders Equity
Liabilities
Current Liabilities
Total Current Liabilities $0
Long-term liabilities
Total liabilities $0
Shareholders' Equity
Common Stock $500,000
Retained Earnings ($7,500)
Total shareholders' equity $492,500
Total liabilities and shareholders' equity $492,500
Chemalite, Inc.
Income Statement from January 1, 2003 to June 30, 2003
Sales $0
Cost of Sales $0
Gross Profit $0
Depreciation Expenses $0
Operating Expense ($7,500)
Net Income ($7,500)
Chemalite, Inc.
Cash Flows Statement from January 1, 2003 to June 30, 2003
Cash flows from Operating Activities
Cash payments for purchases ($75,000)
Cash payments for
...