Anyone here good at accounting? I can't figure out this assignment...

[flocker]

Here are the statements for 20x2 and the transactions for the Cash and Inventory accounts and the Calculation of COGS. The key to the problem was calculating the purchases. This is needed to calculate the COGS which is needed to calculate net income. THe puchase number is $378,000 to make the Trail Balance at 20x2 equal.

I have all of this in excel if you want a copy let me know. In excel the columns are formatted correctly.

Cash Activity for the Year
Cash 12/31/20x1 $10,000
Sales 400,000
Sales Discounts (4,000)
Sales Returns (8,000)
Administrative Expense (20,000)
Purchases (378,000)
Freight In -
Purchase Returns 7,000
Purchase Discounts 3,000

Cash 12/31/20x2 $10,000



Inventory Activity for the Year
Inventory 12/31/20x1 $20,000
Purchases 378,000
Freight In -
Purchase Returns (7,000)
Purchase Discounts (3,000)
Inventory Sold COGS (358,000)
Inventory 12/31/20x2 $30,000



Cost of Goods Sold
Beginning Inventory $20,000
Purchases 378,000
Freight In
Purchase Returns (7,000)
Purchase Discounts (3,000)
Ending Inventory 30,000

Cost of Goods Sold $358,000



Les Fleurs
Balance Sheet
December 31 20x1

Assets Liabilities and Owners Equity

Cash $10,000 Liabilities $-
Inventory 20,000 Owners Equity 30,000
Total Assets $30,000 Total Liabilities and Owners Equity $30,000


Les Fleurs
Statement of Income
For the Year Ending December 31 20x2

Sales $400,000
Sales Discount (4,000)
Sales Returns (8,000)
Net Sales Revenue 388,000

Less: Cost of Goods Sold 358,000

Gross Profit 30,000

Less Administrative Expenses 20,000

Net Income $10,000


Les Fleurs
Statement of Income
For the Year Ending December 31 20x2

Begining Balance December 31, 20x1 $30,000
Net Income for Year 20x2 10,000
Ending Balance, December 31, 20x2 $40,000




Les Fleurs
Balance Sheet
December 31 20x2

Assets Liabilities and Owners Equity

Cash $10,000 Liabilities $-
Inventory 30,000 Owners Equity 40,000
Total Assets $40,000 Total Liabilities and Owners Equity $40,000 $40,000




Les Fleurs
Trail Balance Sheet
December 31, 20x2

Debits Credits
Cash $10,000
Inventory 30,000
Owners Equity $40,000
Sales 400,000
Sales Discounts 4,000
Sales Returns 8,000
Administrative Expense 20,000
Purchases 378,000
Freight In -
Purchase Returns 7,000
Purchase Discounts 3,000

$410,000 $410,000

 

[chicken_china_mom]

Quote:
I don't know what I am doing wrong, but I'm not getting the same answers. I'm so frustrated!!!!! Yes, can I see your Excel sheet? I'd like to compare them side by side and see what the heck it is that I'm not adding right. I really, REALLY hate this class. I'll be so glad when it's done!

 

[chicken_china_mom]

flocker,

Well, in between cleaning, doing dishes, and making dinner, I've been looking over your Excel sheet and comparing it to mine. I can't separate out the European money from the American. Are they combined? IF so, how do I properly separate them? Cause I'm suppose to keep them separate and not convert the Euros to American. I'm trying to figure it out now. I'll post when, and IF I can, lol!

 

[flocker]

Chicken Mom

There is no way to balance the statements using two different currencies. It would be like saying a hen is equal to a rooster. I have never seen mixed currency financial statements.


The purchase number is needed to calculate the COGS and the net income. I did not convert either the purchases or the freight in number. In the problem you were given the begining and ending inventory and some of the changes that took place during the year. The missing piece is the Purchase and Freight In which was given in euros without a conversion factor. The 378k is the number needed to balance.

Look at the Trail Balance Sheet the Cash, Inventory, and Owners Equity are in Balance 10K+20K = 30K at 20x1 and 10K
+ 30K = 40K at 20x2. So for the 20x2 Trail Balance all the accounts from Sales down the debits must equal the credits. The purchases and freight in need to equal the $378k.

flocker