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Sagot :
a. The March income statement for the business is $9,060.
b. The March statement of retained earnings is $6,460.
c. The March 31 balance sheet is :
- Total Assets $27,100
- Total Liabilities & Stockholders Equity $27,100
Income statement
a. Income Statement
Revenues:
Consulting revenue $15,000
Rental revenue $1,100
Total revenue
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Angela Lopez owns and manages a consulting firm called Metrix, which began operations on December 1. On December 31, Metrix shows the following selected accounts and amounts for the month of December.
Equipment $7,000 Office supplies $2,100
Salaries expense 3,600 Rental revenue 1,100
Consulting revenue 15,000 Advertising expense 520
Cash 9,200 Prepaid insurance 1,600
Utilities expense 320 Accounts payable 3,220
Note payable 3,000 Note receivable 3,100
Accounts receivable 4,100 Rent expense 2,600
Common stock 14,000 Unearned revenue 420
Dividends 2,600
Required:
a. Prepare a March income statement for the business.
b. Prepare a March statement of retained earnings. The Retained Earnings account balance at March 1 was $0.
c. Prepare a March 31 balance sheet. Hint: Use the Retained Earnings account balance calculated in part 2.
Sagot :
16,100Expenses:
Salaries expense $3,600
Utilities expense $320
Advertising expense $520
Rent expense $2,600
Total expenses ($7,040)
Net Income $9,060
($16,100-$7,040)
b. Statement of Retained Earnings
Beginning retained earnings 0
Net Income $9,060
Less Dividends $2,600
Retained earnings, Ending $6,460
c. Balance Sheet
Assets Amount Liabilities + Stockholders Equity Amount
Current Assets: Current Liabilities:
Cash $9,200 Accounts payable $3,220
Accounts receivable $4,100 Note payable $3,000
Office supplies $2,100 Unearned revenue $420
Prepaid insurance $1,600 Total Current Liabilities $6,640
Note receivable $3,100 Stockholders Equity:
Total Current Assets $20,100 Common stock $14,000
Plant Assets : Retained earnings $6,460
Equipment $7,000 Total stockholders equity $20,460
Total Assets $27,100 Total Liabilities & Stockholders Equity $27,100
Inconclusion the March income statement for the business is $9,060 and the March statement of retained earnings is $6,460.
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