Question

Tootsie Roll Industries is engaged in the manufacture and sale of candy. Major products include Tootsie Roll, Tootsie Roll Pops, Tootsie Pop Drops, Tootsie Flavor Rolls, Charms, and Blow-Pop lollipops. The following items were listed on Tootsie Roll's recent income statement and balance sheet. Mark each item from the balance sheet as an asset (A), liability (L), or shareholders' equity (SE) and each item from the income statement as a revenue (R) or expense (E).

a. Notes payable to banks
b. General and administrative
c. Accounts payable
d. Dividends payable
e. Retained earnings
f. Cash and cash equivalents
g. Accounts receivable
h. Provision for income taxes[1]
i. Cost of goods sold

Answer 1

Matching the financial statement items to financial statement categories:

Financial Statement Items Financial statement

a. Notes payable to banks Liability (L)

b. General and administrative Expense (E)

c. Accounts payable Liability (L)

d. Dividends payable Liability (L)

e. Retained earnings Shareholders' equity (SE

f. Cash and cash equivalents Asset (A)

g. Accounts receivable Asset (A)

h. Provision for income taxes[1] Expense (E)

i. Cost of goods sold Expense (E)