Accounting Study Guide: Time Value of Money, Inventory Methods,

School: University of Texas, Arlington - Course: ACCT 3311 - Subject: Accounting

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Matoki Matok Inc. sells used books. Assume the purchases are made at the end of the quarter. In order to operate, equipment was purchased in previous years, and the current annual depreciation expense is:698 Matoki Matock issued common shares for 223,300 First quarter sales 354,875 30% of these sales were on credit. The books that were sold were originally purchased for 266,156 Matoki Matok collected from customers221,400 Previous year's taxes were paid in full. Book venders' bills were paid. Land with book value of $18,274 was sold for 16,264 Matoki Matok brought in a consultant to rethink the current division allocation, and prop5,770 Second quarter sales131,750 20% of these sales were on credit. The books that were sold were originally purchased for 102,765 Matoki Matok collected from customers113,141 Matoki Matok purchases additional books389,300 60% was paid in the second quarter and the rest in the third quarter. 11% annual interest was paid for the Notes Payable. This is the same amount that has been paid every year on the same date for the last five years. Third quarter sales416,500 20% of these sales were on credit. The books that were sold were originally purchased for 329,035 Matoki Matok collected from customers82,482 Matoki Matok purchases additional books33,953 60% was paid in the third quarter, 10% in the fourth quarter, and the rest is due at the beginning of the following year. Fourth quarter sales148,750 30% of these sales were on credit. The books that were sold were originally purchased for 113,050 Matoki Matok collected from customers39,314 Dividends were declared and paid in the amount of12,000 Preferred dividends were declared and paid in the amount of700 In mid-December, a customer paid a deposit of a box of books that will be delivered on th891 During the year, other operating expenses124,000 At the end of the year, it turned out that operating expenses included a payment made o2,480 Matoki Matok calculated taxes, which will be paid in the following year, at a rate of:40% Bad debt is estimated to be 1% of sales. Number of common shares outstanding during the year:350,000