Reference no: EM131665210

Question 1 - Presented below is information related to Riverbed Company at December 31, 2017, the end of its first year of operations.

Sales revenue	$327,980
Cost of goods sold	148,580
Selling and administrative expenses	52,100
Gain on sale of plant assets	30,840
Unrealized gain on available-for-sale investments	9,370
Interest expense	6,060
Loss on discontinued operations	11,970
Dividends declared and paid	5,190

Compute the following:

(a) Income from operations

(b) Net income

(c) Comprehensive income

(d) Retained earnings balance at December 31, 2017

Question 2 - Sunland Company has recorded bad debt expense in the past at a rate of 1.5% of accounts receivable, based on an aging analysis. In 2017, Sunland decides to increase its estimate to 2%. If the new rate had been used in prior years, cumulative bad debt expense would have been $396,400 instead of $298,700. In 2017, bad debt expense will be $126,900 instead of $96,360. If Sunland's tax rate is 26%, what amount should it report as the cumulative effect of changing the estimated bad debt rate?

Question 3 - Presented below are changes in the account balances of Wenn Company during the year, except for retained earnings.

	Increase (Decrease)		Increase (Decrease)
Cash	$28,340	Accounts payable	$34,860
Accounts receivable (net)	(18,090)	Bonds payable	(20,670)
Inventory	52,060	Common stock	63,250
Plant assets (net)	46,180	Paid-in capital	15,960

The only entries in Retained Earnings were for net income and a dividend declaration of $16,400.

(a) Compute the net income for the current year.

Question 4 - The Sheffield, Inc. sold 10,630 season tickets at $2,000 each. By December 31, 2017, 16 of the 40 home games had been played. What amount should be reported as a current liability at December 31, 2017?

Question 5 - Cullumber Corporation's adjusted trial balance contained the following asset accounts at December 31, 2017: Cash $9,680, Land $45,100, Patents $14,600, Accounts Receivable $97,740, Prepaid Insurance $6,110, Inventory $37,000, Allowance for Doubtful Accounts $5,700, and Equity Investments (to be sold in the next quarter) $14,360.

Prepare the current assets section of the balance sheet.