Scott Company Is a Merchandising Business That Was Started in 2014

question 95

Essay

Scott Company is a merchandising business that was started in 2014. Scott uses the perpetual inventory system. It experienced the following events during 2014.
1. Acquired $25,000 cash by issuing common stock
2. Purchased inventory on account that cost $14,000, terms 2/10, n/30
3. Sold inventory that had cost $8,400 for $15,000 cash
4. Paid for the merchandise referred to in event 2, within the discount period
Required:
a) Record the events in the financial statements model below; include column totals.
b) Prepare an income statement for 2014.
c) What is the amount of total assets at the end of 2014?

---

Definitions:

Alcoholic Parents

A term referring to parents who suffer from alcoholism, focusing on how their condition affects their parenting and family dynamics.

Developing Baby

Refers to the growth and development of a fetus inside the mother's womb.

Alcoholic Drinks

Beverages that contain ethanol, a type of alcohol produced by fermentation of grains, fruits, or other sources of sugar.

Pregnant

The state of carrying a developing embryo or fetus within the female body.