INFORMATION FOR THE FIRST 3 MONTHS OF 1999
1. Services Revenue: The company billed customers $48,150 for work done
between January 1st and March 31st. This included GST charged to
customers of $3,150. (We did not cover GST so you can ignore)
2. At March 31st 1999 there was $6,000 owing from customers that had not yet
been collected in cash.
3. Operating expenses (not including wages) incurred in the three months were
$11,500. All operating expenses are initially on credit.
4. AYC paid $14,000 to suppliers between January 1st and March 31st, 1999.
5. Wages earned by employees between January 1st and March 31st, 1999 were
$8,500. There were no amounts owing to employees at March 31st, 1999.
6. Supplies inventory costing $1,500 was purchased for cash. A count in the
storeroom on March 31st, 1999 showed that there were supplies costing
$1,200 on hand.
7. Andy purchased three new ride-on mowers on January 1st, 1999, for $6,000
each. He paid $10,000 in cash, and signed a note promising to pay the
balance in nine months (the end of his busy summer season). There will be
no interest paid on the note. The mowers are expected to have a 3 year life,
with no salvage value.
8. On March 31st, 1999, Andy signed a contract to purchase a fourth new ride-on
mower. This mower will be delivered to Andy in July, and will cost $8,000.
9. Andy estimates that approximately $3,500 of the accounts receivable at
January 1st, 1999, which have still not been collected at March 31st, 1999, will
not be collectible.
10.Andy estimates that income taxes for AYC will be $12,000 for the 1999 year.
These taxes will be paid in March in the year 2000. Due to high start-up costs
in the first three years of operation, AYC has not had to pay income taxes
before the 1999 fiscal year.