Exercise 3-16 Prepare financial statements from an adjusted trial balance (LO3-5
ID: 2332959 • Letter: E
Question
Exercise 3-16 Prepare financial statements from an adjusted trial balance (LO3-5) [The following information applies to the questions displayed below.) The December 31, 2018, adjusted trial balance for Fightin' Blue Hens Corporation is presented below. Debit S 10,500 135,000 Credit Accounts Receivable Prepaid Rent Supplies Equipment 22,500 250,000 S120,000 Accounts Payable Salaries Payable Interest Payable Notes Payable (due in two years Common Stock Retained Earnings Service Revenue Salaries Expense Rent Expense Depredation Expense Interest Expense 9,500 3,500 45,000 S 713,500 S 713,500 References Section Break Exercise 3-16 Prepare financial statements from an adjusted trial balance (LO3-5)Explanation / Answer
Answer
Service revenue
$ 350,000.00
Expenses:
Salaries Expense
$ 250,000.00
Rent Expense
$ 12,500.00
Depreciation Expense
$ 25,000.00
Interest Expense
$ 3,500.00
Total Expenses
$ 291,000.00
Net Income
$ 59,000.00
Common Stock
Retained earnings
Total Stockholder's Equity
Balance at Jan 1
$ 150,000.00
$ 45,000.00
$ 195,000.00
Add: Net Income
$ 59,000.00
$ 59,000.00
Less: Dividends
$ -
$ -
balance at Dec 31
$ 150,000.00
$ 104,000.00
$ 254,000.00
ASSETS
LIABILITIES
Cash
$ 10,500.00
Accounts payable
$ 10,500.00
Accounts receivables
$ 135,000.00
Salaries Payable
$ 9,500.00
Prepaid Rent
$ 4,500.00
Interest payable
$ 3,500.00
Supplies
$ 22,500.00
Total Current Assets
$ 172,500.00
Total Current Liabilities
$ 23,500.00
Notes payable (in 2 years)
$ 25,000.00
Total Long Term Liabilities
$ 25,000.00
STOCKHOLDERS' EQUITY
Equipment
$ 250,000.00
Common Stock
$ 150,000.00
Accumulated Depreciation
$ (120,000.00)
Retained earnings
$ 104,000.00
Total Long Term Assets
$ 130,000.00
Total Stockholder's Equity
$ 254,000.00
Total Assets
$ 302,500.00
Total Liabilities & Stockholders Equity
$ 302,500.00
Service revenue
$ 350,000.00
Expenses:
Salaries Expense
$ 250,000.00
Rent Expense
$ 12,500.00
Depreciation Expense
$ 25,000.00
Interest Expense
$ 3,500.00
Total Expenses
$ 291,000.00
Net Income
$ 59,000.00
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