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Prepare the (1) income statement and (2) statement of owner's equity for the year ended december 31, and (3) balance sheet at december 31. the stark, capital account balance was $24,800 on december 31 of the prior year.

Sagot :

anthougo

The preparation of the financial statements of Stark Company is as follows:

1) Stark Company

Income Statement

For the year ended December 31

Services revenue                     $20,000

Interest expense              500

Wages expense            7,500

Depreciation expense 2,000

Insurance expense       1,800

Utilities expense           1,300

Supplies expense          200   $13,300

Net income                                $6,700

2) Stark Company

Statement of Owner's Equity

For the year ended December 31

Stark, Capital         $24,800

Stark, Withdrawals   (3,000)

Net Income               6,700

Stark, Capital       $28,500

3) Stark Company

Balance Sheet

At December 31

Assets

Current assets:

Cash                                                     $10,000

Accounts receivable                              4,000

Supplies                                                     800

Prepaid insurance                                 2,500

Long-term assets:

Buildings                             40,000

Accumulated depreciation 15,000 $25,000

Total assets                                      $42,300

Liabilities and Equity:

Current liabilities:

Accounts payable                              $1,500

Wages payable                                       400

Unearned revenue                                 800

Interest payable                                      100

Total current liabilities                     $2,800

Long-term liabilities:

Notes payable                               $ 11,000

Total liabilities                                $13,800

Equity:

Stark, Capital                               $28,500

Total liabilities and Capital        $42,300

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Question Completion:

Accounts payable 1,500

Wages payable 400

Unearned revenue 800

Interest payable  100

Notes payable $ 11,000

Stark, Capital 24,800

Stark, Withdrawals  3,000

Cash 10,000

Accounts receivable  4,000

Supplies 800

Prepaid insurance 2,500

Buildings  40,000

Accumulated depreciation-Buildings $ 15,000

Services revenue  20,000

Interest expense 500

Wages expense  7,500

Depreciation expense-Buildings 2,000

Insurance expense 1,800

Utilities expense  1,300

Supplies expense 200

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