Comprehensive problem 1-6 Course Project FINANCIAL ACCOUNTING As a recently hired accountant for a small business, SMC, Inc., you are provided with last year’s balance sheet, income statement, and...

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Comprehensive problem 1-6 Course Project FINANCIAL ACCOUNTING As a recently hired accountant for a small business, SMC, Inc., you are provided with last year’s balance sheet, income statement, and post-closing trial balance to familiarize yourself with the business. SMC, Inc. Balance Sheet December 31, 2021 Assets Cash ......................................................................................................... $34,500 Accounts receivable ................................................................................ 25,000 Inventory .................................................................................................. 10,000 Supplies ................................................................................................... 200 Total assets.............................................................................................. $69,700 Liabilities and Stockholders’ Equity Liabilities: Accounts payable ............................................................................. $12,000 Salaries payable ............................................................................... 1,000 Income taxes payable ...................................................................... 3,675 Total liabilities.......................................................................................... $16,675 Stockholders’ equity: Capital stock (10,000 shares outstanding).................................... $25,000 Retained earnings ............................................................................ 28,025 Total stockholders’ equity ....................................................................... 53,025 Total liabilities and stockholders’ equity................................................ $69,700 SMC, Inc. Income Statement For the Year Ended December31,2021 Sales revenue .......................................................................................... $110,000 Rent revenue ........................................................................................... 1,000 Total revenues......................................................................................... $111,000 Less cost of goods sold........................................................................... 60,000 Gross profit ........................................................................................... $ 51,000 Less operating expenses: Supplies expense ............................................................................. $ 400 Salaries expense .............................................................................. 22,000 Miscellaneous expense................................................................... 4,100 26,500 Income beforetaxes.............................................................................
Answered Same DayJul 23, 2022

Answer To: Comprehensive problem 1-6 Course Project FINANCIAL ACCOUNTING As a recently hired accountant for a...

Khushboo answered on Jul 24 2022
65 Votes
The overall financial health of the entity is good and the entity has performed well in current year. However, the entity liquidity position has been declined to some extent i.e. current ratio from 4.18 times to 3.82 times but still the entity is have strong liquidity position. Further, the debt has...
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