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PR4-1B)
1.
LIGHTWORKS COMPANY
Income Statement
For the Year Ended July 31, 2010
Revenues:
Fees revenue $307,000
Rent revenue 1,000
Total revenues $308,000
Expenses:
Salaries and wages expense $114,900
Advertising expense 21,700
Utilities expense 11,400
Repairs expense 8,850
Depreciation expense—equipment 3,200
Insurance expense 3,000
Supplies expense 1,900
Depreciation expense—building 1,400
Miscellaneous expense 4,320
Total expenses 170,670
Net income $ 137,330
2.
LIGHTWORKS COMPANY
Statement of Owner’s Equity
For the Year Ended July 31, 2010
Marisa Crider, capital, August 1, 2009 $ 103,100
Net income for the year $137,330
Less withdrawals 10,000
Increase in owner’s capital 127,330
Marisa Crider, capital, July 31, 2010 $230,430
3.
LIGHTWORKS COMPANY
Balance Sheet
July 31, 2010
Assets Liabilities
Current assets: Current liabilities:
Cash $ 5,800 Accounts payable $5,700
Accounts receivable 22,200 Salaries and wages
Prepaid insurance 1,200 payable 1,800
Supplies 830 Unearned rent 1,100
Total current assets $ 30,030 Total liabilities $ 8,600
Property, plant, and equipment:
Land $98,000
Building $200,000 Owner’s Equity
Less accum. depreciation 101,700 98,300 Marisa Crider, capital 230,430
Equipment $101,000
Less accum. depreciation 88,300 12,700
Total property, plant, and
equipment 209,000 Total liabilities and
Total assets $239,030 owner’s equity $239,030
4.
2010
July 31 Fees Revenue 307,000
Rent Revenue 1,000
Income Summary 308,000
31 Income Summary 170,670
Salaries & Wages Expense 114,900
Advertising Expense 21,700
Utilities Expense 11,400
Repairs Expense 8,850
Depreciation Expense—Equipment 3,200
Insurance Expense 3,000
Supplies Expense 1,900
Depreciation Expense—Building 1,400
Miscellaneous Expense 4,320
31 Income Summary 137,330
Marisa Crider, Capital 137,330
31 Marisa Crider, Capital 10,000
Marisa Crider, Drawing 10,000
5.
LIGHTWORKS COMPANY
Post-Closing Trial Balance
July 31, 2010
Debit Credit
Balances Balances
Cash 5,800
Accounts Receivable 22,200
Prepaid Insurance 1,200
Supplies 830
Land 98,000
Building 200,000
Accumulated Depreciation—Building 101,700
Equipment 101,000
Accumulated Depreciation—Equipment 88,300
Accounts Payable 5,700
Salaries & Wages Payable 1,800
Unearned Rent 1,100
Marisa Crider, Capital 230,430
429,030 429,030
PR4-2B)
1.
SUSPICIONS COMPANY
Income Statement
For the Year Ended November 30, 2010
Revenues:
Service fees $480,000
Rent revenue 20,000
Total revenues $500,000
Expenses:
Salary expense $375,000
Rent expense 62,500
Supplies expense 9,000
Depreciation expense—equipment 5,000
Utilities expense 4,400
Repairs expense 3,200
Insurance expense 2,800
Miscellaneous expense 4,600
Total expenses 466,500
Net income $ 33,500
SUSPICIONS COMPANY
Statement of Owner’s Equity
For the Year Ended November 30, 2010
Curtis Graves, capital, December 1, 2009 $172,800
Net income for the year $33,500
Less withdrawals 30,000
Increase in owner’s capital 3,500
Curtis Graves, capital, November 30, 2010 $176,300
SUSPICIONS COMPANY
Balance Sheet
November 30, 2010
Assets Liabilities
Current assets: Current liabilities:
Cash $11,500 Accounts payable $6,000
Accounts receivable 47,200 Salaries payable 1,500
Supplies 3,500 Unearned rent 3,000
Prepaid insurance 4,800 Total liabilities $ 10,500
Total current assets $ 67,000
Property, plant, and equipment:
Equipment $175,000 Owner’s Equity
Less accum. depreciation 55,200 Curtis Graves, capital 176,300
Total property, plant, and
equipment 119,800 Total liabilities and
Total assets $186,800 owner’s equity $186,800
2.
2010
Nov. 30 Service Fees 480,000
Rent Revenue 20,000
Income Summary 500,000
30 Income Summary 466,500
Salary Expense 375,000
Rent Expense 62,500
Supplies Expense 9,000
Depreciation Expense—Equipment 5,000
Utilities Expense 4,400
Repairs Expense 3,200
Insurance Expense 2,800
Miscellaneous Expense 4,600
30 Income Summary 33,500
Curtis Graves, Capital 33,500
30 Curtis Graves, Capital 30,000
Curtis Graves, Drawing 30,000
3. $10,000 net loss. The $40,000 decrease is caused by the $30,000 withdrawals and a $10,000 net loss.
PR4-3B)
1, 3, 6.
CashApr. 30 Bal. 11,000
Laundry Supplies
Apr. 30 Bal. 18,900 / Apr. 30 Adj. 14,900
30 Adj. Bal. 4,000
Prepaid Insurance
Apr. 30 Bal. 8,600 / Apr. 30 Adj. 5,200
30 Adj. Bal. 3,400
Laundry Equipment
Apr. 30 Bal. 284,000
Accumulated Depreciation
Apr. 30 Bal. 150,400
30 Adj. 6,000
30 Adj. Bal. 156,400
Accounts Payable
Apr. 30 Bal. 9,800
Wages Payable
Apr. 30 Adj. 1,100
Deanna Beaven, Capital
Apr. 30 Clos. 8,400 / Apr. 30 Bal. 107,600
_____ / Apr. 30 Clos. 35,900
Apr. 30 Bal. 135,100
Deanna Beaven, Drawing
Apr. 30 Bal. 8,400 / Apr. 30 Clos. 8,400
Income Summary
Apr. 30 Clos. 196,300 / Apr. 30 Clos. 232,200
Apr. 30 Clos. 35,900
Laundry Revenue
Apr. 30 Clos. 232,200 / Apr. 30 Bal. 232,200
Wages Expense
Apr. 30 Bal. 104,000 / Apr. 30 Clos. 105,100
30 Adj. 1,100 / ______
30 Adj. Bal. 105,100
Rent Expense
Apr. 30 Bal. 39,300 / Apr. 30 Clos. 39,300
Utilities Expense
Apr. 30 Bal. 20,400 / Apr. 30 Clos. 20,400
Laundry Supplies Expense
Apr. 30 Adj. 14,900 / Apr. 30 Clos. 14,900
Depreciation Expense
Apr. 30 Adj. 6,000 / Apr. 30 Clos. 6,000
Insurance Expense
Apr. 30 Adj. 5,200 / Apr. 30 Clos. 5,200
Miscellaneous Expense
Apr. 30 Bal. 5,400 / Apr. 30 Clos. 5,400
2. Optional (Appendix)
A / B / C / D / E / F / G / H / I / J / K1 / OCEAN BREEZE LAUNDROMAT
2 / End-of-Period Spreadsheet (Work Sheet)
3 / For the Year Ended April 30, 2010
4 / Unadjusted
Trial Balance /
Adjustments / Adjusted
Trial Balance / Income
Statement / Balance
Sheet
5
6 / Account Title / Dr. / Cr. / Dr. / Cr. / Dr. / Cr. / Dr. / Cr. / Dr. / Cr.
7 / Cash / 11,000 / 11,000 / 11,000
8 / Laundry Supplies / 18,900 / (a)14,900 / 4,000 / 4,000
9 / Prepaid Insurance / 8,600 / (b) 5,200 / 3,400 / 3,400
10 / Laundry Equipment / 284,000 / 284,000 / 284,000
11 / Accumulated Depr. / 150,400 / (c) 6,000 / 156,400 / 156,400
12 / Accounts Payable / 9,800 / 9,800 / 9,800
13 / Wages Payable / (d) 1,100 / 1,100 / 1,100
14 / Deanna Beaven, Capital / 107,600 / 107,600 / 107,600
15 / Deanna Beaven, Drawing / 8,400 / 8,400 / 8,400
16 / Laundry Revenue / 232,200 / 232,200 / 232,200
17 / Wages Expense / 104,000 / (d) 1,100 / 105,100 / 105,100
18 / Rent Expense / 39,300 / 39,300 / 39,300
19 / Utilities Expense / 20,400 / 20,400 / 20,400
20 / Laundry Supplies Exp. / (a) 14,900 / 14,900 / 14,900
21 / Depreciation Expense / (c) 6,000 / 6,000 / 6,000
22 / Insurance Expense / (b) 5,200 / 5,200 / 5,200
23 / Misc. Expense / 5,400 / 5,400 / 5,400
24 / 500,000 / 500,000 / 27,200 / 27,200 / 507,100 / 507,100 / 196,300 / 232,200 / 310,800 / 274,900
25 / Net income / 35,900 / ______ / ______ / 35,900
26 / 232,200 / 232,200 / 310,800 / 310,800
3.
Adjusting Entries
2010
Apr. 30 Laundry Supplies Expense 14,900
Laundry Supplies 14,900
Supplies used ($18,900 – $4,000).
30 Insurance Expense 5,200
Prepaid Insurance 5,200
Insurance expired.
30 Depreciation Expense 6,000
Accumulated Depreciation 6,000
Equipment depreciation.
30 Wages Expense 1,100
Wages Payable 1,100
Accrued wages.
4.
OCEAN BREEZE LAUNDROMAT
Adjusted Trial Balance
April 30, 2010
Debit Credit
Balances Balances
Cash 11,000
Laundry Supplies 4,000
Prepaid Insurance 3,400
Laundry Equipment 284,000
Accumulated Depreciation 156,400
Accounts Payable 9,800
Wages Payable 1,100
Deanna Beaven, Capital 107,600
Deanna Beaven, Drawing 8,400
Laundry Revenue 232,200
Wages Expense 105,100
Rent Expense 39,300
Utilities Expense 20,400
Laundry Supplies Expense 14,900
Depreciation Expense 6,000
Insurance Expense 5,200
Miscellaneous Expense 5,400
507,100 507,100
5.
OCEAN BREEZE LAUNDROMAT
Income Statement
For the Year Ended April 30, 2010
Laundry revenue $232,200
Expenses:
Wages expense $105,100
Rent expense 39,300
Utilities expense 20,400
Laundry supplies expense 14,900
Depreciation expense 6,000
Insurance expense 5,200
Miscellaneous expense 5,400
Total expenses 196,300
Net income $ 35,900
OCEAN BREEZE LAUNDROMAT
Statement of Owner’s Equity
For the Year Ended April 30, 2010
Deanna Beaven, capital, May 1, 2009 $ 107,600
Net income for the year $ 35,900
Less withdrawals 8,400
Increase in owner’s equity 27,500
Deanna Beaven, capital, April 30, 2010 $ 135,100
OCEAN BREEZE LAUNDROMAT
Balance Sheet
April 30, 2010
Assets Liabilities
Current assets: Current liabilities:
Cash $ 11,000 Accounts payable $9,800
Laundry supplies 4,000 Wages payable 1,100
Prepaid insurance 3,400 Total liabilities $ 10,900
Total current assets $ 18,400
Property, plant, and
equipment: Owner’s Equity
Laundry equipment $284,000 Deanna Beaven, capital 135,100
Less accum. depr. 156,400
Total property, plant,
and equipment 127,600 Total liabilities and
Total assets $ 146,000 owner’s equity $ 146,000
6.
Closing Entries
2010
Apr. 30 Laundry Revenue 232,200
Income Summary 232,200
30 Income Summary 196,300
Wages Expense 105,100
Rent Expense 39,300
Utilities Expense 20,400
Laundry Supplies Expense 14,900
Depreciation Expense 6,000
Insurance Expense 5,200
Miscellaneous Expense 5,400
30 Income Summary 35,900
Deanna Beaven, Capital 35,900
30 Deanna Beaven, Capital 8,400
Deanna Beaven, Drawing 8,400
7.
OCEAN BREEZE LAUNDROMAT
Post-Closing Trial Balance
April 30, 2010
Debit Credit
Balances Balances
Cash 11,000
Laundry Supplies 4,000
Prepaid Insurance 3,400
Laundry Equipment 284,000
Accumulated Depreciation 156,400
Accounts Payable 9,800
Wages Payable 1,100
Deanna Beaven, Capital 135,100
302,400 302,400
PR4-4B)
1. Optional (Appendix)
A / B / C / D / E / F / G / H / I / J / K1 / HANDY MAN SERVICES CO.
2 / End-of-Period Spreadsheet (Work Sheet)
3 / For the Month Ended July 31, 2010
4 / Unadjusted
Trial Balance /
Adjustments / Adjusted
Trial Balance / Income
Statement / Balance
Sheet
5
6 / Account Title / Dr. / Cr. / Dr. / Cr. / Dr. / Cr. / Dr. / Cr. / Dr. / Cr.
7 / Cash / 26,870 / 26,870 / 26,870
8 / Accounts Receivable / 10,900 / (a) 2,200 / 13,100 / 13,100
9 / Supplies / 3,050 / (b) 1,600 / 1,450 / 1,450
10 / Prepaid Insurance / 4,800 / (c) 800 / 4,000 / 4,000
11 / Land / 50,000 / 50,000 / 50,000
12 / Building / 57,500 / 57,500 / 57,500
13 / Acc. Depr.—Building / 23,400 / (d) 1,000 / 24,400 / 24,400
14 / Equipment / 32,000 / 32,000 / 32,000
15 / Acc. Depr.—Equipment / 10,200 / (e) 750 / 10,950 / 10,950
16 / Accounts Payable / 3,350 / 3,350 / 3,350
17 / Wages Payable / (g) 600 / 600 / 600
18 / Unearned Rent / 2,700 / (f) 900 / 1,800 / 1,800
19 / Rafael Cagle, Capital / 123,000 / 123,000 / 123,000
20 / Rafael Cagle, Drawing / 2,000 / 2,000 / 2,000
21 / Service Revenue / 35,000 / (a) 2,200 / 37,200 / 37,200
22 / Rent Revenue / (f) 900 / 900 / 900
23 / Wages Expense / 5,000 / (g) 600 / 5,600 / 5,600
24 / Supplies Expense / (b) 1,600 / 1,600 / 1,600
25 / Rent Expense / 2,500 / 2,500 / 2,500
26 / Depr. Exp.—Building / (d) 1,000 / 1,000 / 1,000
27 / Utilities Expense / 1,650 / 1,650 / 1,650
28 / Depr. Exp.—Equipment / (e) 750 / 750 / 750
29 / Insurance Expense / (c) 800 / 800 / 800
30 / Misc. Expense / 1,380 / 1,380 / 1,380
31 / 197,650 / 197,650 / 7,850 / 7,850 / 202,200 / 202,200 / 15,280 / 38,100 / 186,920 / 164,100
32 / Net income / 22,820 / ______ / ______ / 22,820
33 / 38,100 / 38,100 / 186,920 / 186,920
2.
JOURNAL Page 26
Post.
Date Ref. Debit Credit
2010 Adjusting Entries
July 31 Accounts Receivable 12 2,200
Service Revenue 41 2,200
Accrued revenue.
31 Supplies Expense 52 1,600
Supplies 13 1,600
Supplies used ($3,050 – $1,450).
31 Insurance Expense 57 800
Prepaid Insurance 14 800
Insurance expired.
31 Depreciation Expense—Building 54 1,000
Accum. Depreciation—Building 17 1,000
Building depreciation.
31 Depreciation Expense—Equipment 56 750
Accum. Depreciation—Equipment 19 750
Equipment depreciation.
31 Unearned Rent 23 900
Rent Revenue 42 900
Rent revenue earned ($2,700 – $1,800).
31 Wages Expense 51 600
Wages Payable 22 600
Accrued wages.
3.
HANDY MAN SERVICES CO.
Adjusted Trial Balance
July 31, 2010
Debit Credit
Balances Balances
Cash 26,870
Accounts Receivable 13,100
Supplies 1,450
Prepaid Insurance 4,000
Land 50,000
Building 57,500
Accumulated Depreciation—Building 24,400
Equipment 32,000
Accumulated Depreciation—Equipment 10,950
Accounts Payable 3,350
Wages Payable 600
Unearned Rent 1,800
Rafael Cagle, Capital 123,000
Rafael Cagle, Drawing 2,000
Service Revenue 37,200
Rent Revenue 900
Wages Expense 5,600
Supplies Expense 1,600
Rent Expense 2,500
Depreciation Expense—Building 1,000
Utilities Expense 1,650
Depreciation Expense—Equipment 750
Insurance Expense 800
Miscellaneous Expense 1,380
202,200 202,200
4.
HANDY MAN SERVICES CO.
Income Statement
For the Month Ended July 31, 2010
Revenues:
Service revenue $37,200
Rent revenue 900
Total revenues $ 38,100
Expenses:
Wages expense $ 5,600
Rent expense 2,500
Utilities expense 1,650
Supplies expense 1,600
Depreciation expense—building 1,000
Insurance expense 800
Depreciation expense—equipment 750
Miscellaneous expense 1,380
Total expenses 15,280
Net income $ 22,820
HANDY MAN SERVICES CO.
Statement of Owner’s Equity
For the Month Ended July 31, 2010
Rafael Cagle, capital, July 1, 2010 $ 118,000
Additional investment during the month 5,000
Total $ 123,000
Net income for the month $ 22,820
Less withdrawals 2,000
Increase in owner’s equity 20,820
Rafael Cagle, capital, July 31, 2010 $ 143,820
HANDY MAN SERVICES CO.
Balance Sheet
July 31, 2010
Assets Liabilities
Current assets: Current liabilities:
Cash $ 26,870 Accounts payable $3,350
Accounts receivable 13,100 Wages payable 600
Supplies 1,450 Unearned rent 1,800
Prepaid insurance 4,000 Total liabilities $ 5,750
Total current assets $ 45,420