Transaction # Transaction

1 Non cash revenue for the year

2 Inventory bought through the year (60 day payables)
3 Depreciation on building and equipment
4 Year end inventory audit indicated that COGS were
5 Taxes for the year, not yet paid
6 Equipment bought on credit
Cash receipts
7 Cash revenue
8 Collected accounts receivables
Cash disbursements
9 Paid wages and salaries for manufacturing of goods (all
wages for the year were paid in full and in cash)
10 Utilities - majority due to manufacturing facilities
11 Additional inventory bought
12 Paid selling and administration
13 Interest on loan
14 Pre-pay your rent for the first 3 months of 2017
15 Accounts payable payments made

Amount
800,000
525,000
20,000
550,000
50,000
28,000
100,000
750,000

125,000
40,000
55,000
25,000
11,000
24,000
400,000

T-Accounts
Assets

7
8

2
11

Cash
Debit
Credit
100,000
125,000
750,000
40,000
55,000
25,000
11,000
24,000
400,000
170,000
Inventories
Debit
Credit
525,000
550,000
55,000

9
10
11
12
13
14
15

Accounts Receivable
Debit
Credit
1
800,000
750,000

50,000
Pre-Paid Expenses
Debit
Credit
14
24,000

30,000
Plant and Equip. net
Debit
Credit
6
28,000
20,000

24,000

8,000
Expenses
COGS
Debit
Credit
4
550,000
9
125,000
10
40,000

Debit
12

715,000
Depreciation
Debit
Credit
3
20,000

SG&A
Credit
25,000

25,000
Interest Expense
Debit
Credit
13
11,000

Page 1

8 15

T-Accounts

20,000
Taxes
Debit
Credit
5
50,000

11,000

50,000

Total Credits

Page 2

T-Accounts
Check Marks
Liabilities
Accounts Payable
Debit
Credit
400,000
525,000
28,000

153,000
Taxes Payable
Debit
Credit
50,000

Accrued Liabilities
Debit
Credit
2
6

0
Long-term Debt
Debit
Credit
5

50,000
Equity
Paid in Capital
Debit
Credit

Revenue
Revenue
Debit

0
Retained Earnings
Debit
Credit

0
Credit
800,000
100,000

1
7

900,000

Page 3

48

T-Accounts

Page 4

Financials Start
Assets
Current Assets
Cash
Accounts Receivables
Inventories
Prepaid Expenses
Investments
Total Current Assets
Noncurrent Assets
Land
Plant and Equip. Net
Total Noncurrent Assets
Total Assets

24,000
46,000
12,000
5,000
0
87,000
430,000
250,000
680,000
767,000

Page 5

Financials Start
Liabilities
Current Liabilities
Acc. Payable
Short Term Debt
Accrued Liab.
Wages Payable
Taxes Payable
Total Current Liabilities
Noncurrent Liabilities
Long term debt
Total Noncurrent Liabilities
Total Liabilities
Equity
Paid-in Capital - Jane
Paid-in Capital - Others
Retained Earnings
Total Equity
Total Liabilities and Equity

31,000
0
0
0
12,000
43,000
91,000
91,000
134,000
531,000
0
102,000
633,000
767,000

Page 6

Check Marks
Balancing
Retained Earning Matches Income st
Total

Financials Start
39
2
1
90

Page 7

Financials End
Assets
Current Assets
Cash
Accounts Receivables
Inventories
Prepaid Expenses
Investments
Total Current Assets
Noncurrent Assets
Land
Plant and Equip. Net
Total Noncurrent Assets
Total Assets

Income Statement
Revenue
Cost of sales
Gross margin
Selling and Admin (SG&A)
EBITDA
Depreciation
EBIT
Interest expense
Income Before Taxes
Provision for Taxes
Net Income
Dividends
Addition to Equity

194,000
96,000
42,000
29,000
0
361,000
430,000
258,000
688,000
1,049,000

900,000
715,000
185,000
25,000
160,000
20,000
140,000
11,000
129,000
50,000
79,000
0
79,000

Page 8

Financials End
Liabilities
Current Liabilities
Acc. Payable
Short Term Debt
Accrued Liab.
Wages Payable
Taxes Payable
Total Current Liabilities
Noncurrent Liabilities
Long term debt
Total Noncurrent Liabilities
Total Liabilities
Equity
Paid-in Capital - Jane
Paid-in Capital - Others
Retained Earnings
Total Equity
Total Liabilities and Equity

184,000
0
0
0
62,000
246,000
91,000
91,000
337,000
531,000
0
181,000
712,000
1,049,000

Page 9

Check Marks
Balancing
Retained Earning Matches Income st
Total

Financials End
39
2
1
90

Page 10

In the last chapter of the text, titled Development Economics, the author
states that "It is one thing to explain what makes rich countries work; it is quite
another to develop a strategy for transforming the developing world." This is a
multifaceted and complex problem which the author explores through 11
subsections with illustrative examples. Provide two examples from this
chapter and explain their importance to understanding this problem.

Effectivegovernmentinstitutions --> related to historic government

put in place by colonial powers
Propertyrights--> value of property not legally owned by poor of the
world amounts to $9 trillion dollars - the informal property rights are
like barter, does not work in large complex economies
Noexcessiveregulation--> excessive regulation goes hand in hand
with corruption
Humancaptial--> need many with expertise, education leads to
economic growth
Geography --> warm climates lead to poorer countries i.e. more
disease , they should focus on non-agricultural sectors
Opennesstotrade-->more trade = good
responsiblefiscalandmonetarpolicy--> poor fiscal responsibility
leads to a variety of compounding problems
naturalresourcesmatterlessthanyouthink-->countries fixate on
this and should focus more on human capital and education
democracy-->no famine
warisbad-->civil war = poor economic performance
womanpower-->Saudi arabia