Doner Company Inc. begins operations on January 1, Year 1. The company’s unadjusted financial statements for the year ended December 31, Year 1, appear as

Academic Writing accounting, business-managerial-accounting Doner Company Inc. begins operations on January 1, Year 1. The company’s unadjusted financial statements for the year ended December 31, Year 1, appear as

accounting, business-managerial-accounting

Doner Company Inc. begins operations on January 1, Year 1. The company’s unadjusted financial statements for the year ended December 31, Year 1, appear as

Doner Company Inc. begins operations on January 1, Year 1. The company’s unadjusted financial statements for the year ended December 31, Year 1, appear as follows: Date Transaction Cost Useful Life GPI January 15, Year 1 . . . . . . . . . Purchase Machine X $ 20,000 4 years 100 March 20, Year 1 . . . . . . . . . . Purchase Machine Y 55,000 5 years 110 October 10, Year 1 . . . . . . . . Purchase Machine Z 130,000 10 years 130 December 31, Year 1 . . . . . . . 140 April 15, Year 2 . . . . . . . . . . . Sold Machine X 160 December 31, Year 2 . . . . . . . 180 Balance Sheets 1/1/Y1 12/31/Y1 Cash and receivables . . . . . . . . . . . . . . . . . . . . . . $20,000 $35,000 Fixed assets, net . . . . . . . . . . . . . . . . . . . . . . . . . 50,000 45,000 Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $70,000 $80,000 Payables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $15,000 $15,000 Contributed capital . . . . . . . . . . . . . . . . . . . . . . . 55,000 55,000 Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . — 10,000 Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $70,000 $80,000 Income Statement, Year 1 Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $50,000 Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . (5,000) Other expenses . . . . . . . . . . . . . . . . . . . . . . . . . . (35,000) Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $10,000 Revenues and expenses occur evenly throughout the year; revenues and other expenses are realized in terms of monetary assets (cash and receivables). General price indexes for Year 1 are as follows: 1/1/Y1 . . . . . . . . . . . . . . . . . 100 Average Y1 . . . . . . . . . . . . . 120 12/31/Y1 . . . . . . . . . . . . . . 150 equired: a. Calculate Doner Company’s Year 1 purchasing power gain or loss on net monetary items. b. Determine Doner Company’s Year 1 income AND Balance Sheets on a general purchasing power basis (ignore income taxes).

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