Question

The Not-too-tough company started its operation in 2018. Its balance sheet for December 31, 2018, showed...

The Not-too-tough company started its operation in 2018. Its balance sheet for December 31, 2018, showed the following account balances (there were no other accounts listed, numbers are in thousands):

Assets
Assets 2019
Cash and cash equivalents 400
Inventory 59
Accounts receivable 90
Property, plants, and equipment 100
Less: accumulated depreciation (10)
Property and equipment – net 90
Prepaid rent 0
Total Assets 639
Liabilities and Equity
Liabilities and Equity 2019
Accounts payable 50
Advance from customers 40
Wages payables 6
Paid-in capital 350
Retained earnings 193
Total Liabilities and Shareholders’ Equity 639

During 2019 the following transactions occurred:

  1. Rent for 24 months, starting January 1, 2019, in the amount of $48, was paid in cash.
  2. On July 31, 2019, the company enters into a new labor contract with the employees’ union that calls for a $15 increase in wages, effective February 1, 2020.
  3. Sales, all on credit, were $850. Collections from customers were $720.
  4. In addition to the transactions described in item 3 above, products were shipped to the customer who paid $40 in advance (see December 31, 2018 balances). The selling price was $120, and the customer will pay the balance in early 2020.
  5. The company purchased $550 worth of inventory, on account. Payments on accounts payable were $470.
  6. Based on a physical count, inventory balance as of December 31, 2019 was $85. The market value of these inventories was $90.
  7. The employees earned $54 as wages. Cash wage payments to employees were $57.
  8. Depreciation for the year equals $15.
  9. A dividend of $55 was declared and paid during 2019.

Prepare the balance sheet by filling in the blanks.

Assets
Assets 2019
Cash and cash equivalents
Inventory
Accounts receivable
Property, plants, and equipment
Less: accumulated depreciation (  )
Property and equipment – net
Prepaid rent
Total Assets
Liabilities and Equity
Liabilities and Equity 2019
Accounts payable
Advance from customers
Wages payables
Paid-in capital
Retained earnings
Total Liabilities and Shareholders’ Equity
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