The Diversified Portfolio Corporation provides investment advice to customers. A condensed income statement for the year er December 31, 2021, appears below: Service revenue Operating expenses Income before income taxes Income tax expense Net income $1,060,000 780,000 280,000 70,000 $ 210,000 The following balance sheet information also is available: Cash Accounts receivable Accrued liabilities (for operating expenses) Income taxes payable 12/31/2021 $ 389,000 136,000 86,000 18,000 12/31/2020 $ 78,000 108,000 68,000 31,000 In addition, the following transactions took place during the year: 1. Common stock was issued for $116,000 in cash. 2. Long-term investments were sold for $58,000 in cash. The original cost of the investments also was $58,000. 3. $88,000 in cash dividends was paid to shareholders. 4. The company has no outstanding debt, other than those payables listed above. 5. Operating expenses include $38,000 in depreciation expense.
The Diversified Portfolio Corporation provides investment advice to customers. A condensed income statement for the year er December 31, 2021, appears below: Service revenue Operating expenses Income before income taxes Income tax expense Net income $1,060,000 780,000 280,000 70,000 $ 210,000 The following balance sheet information also is available: Cash Accounts receivable Accrued liabilities (for operating expenses) Income taxes payable 12/31/2021 $ 389,000 136,000 86,000 18,000 12/31/2020 $ 78,000 108,000 68,000 31,000 In addition, the following transactions took place during the year: 1. Common stock was issued for $116,000 in cash. 2. Long-term investments were sold for $58,000 in cash. The original cost of the investments also was $58,000. 3. $88,000 in cash dividends was paid to shareholders. 4. The company has no outstanding debt, other than those payables listed above. 5. Operating expenses include $38,000 in depreciation expense.
Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter6: Accounting For Financial Management
Section: Chapter Questions
Problem 12P
Related questions
Question
Please could you answer the attached question, thanks.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Intermediate Financial Management (MindTap Course…
Finance
ISBN:
9781337395083
Author:
Eugene F. Brigham, Phillip R. Daves
Publisher:
Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Financial Reporting, Financial Statement Analysis…
Finance
ISBN:
9781285190907
Author:
James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:
Cengage Learning
Intermediate Financial Management (MindTap Course…
Finance
ISBN:
9781337395083
Author:
Eugene F. Brigham, Phillip R. Daves
Publisher:
Cengage Learning
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Financial Reporting, Financial Statement Analysis…
Finance
ISBN:
9781285190907
Author:
James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:
Cengage Learning
Financial Accounting: The Impact on Decision Make…
Accounting
ISBN:
9781305654174
Author:
Gary A. Porter, Curtis L. Norton
Publisher:
Cengage Learning
Fundamentals Of Financial Management, Concise Edi…
Finance
ISBN:
9781337902571
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
Cornerstones of Financial Accounting
Accounting
ISBN:
9781337690881
Author:
Jay Rich, Jeff Jones
Publisher:
Cengage Learning