Use the following accounts and information to prepare, in good form, an income s
ID: 2503994 • Letter: U
Question
Use the following accounts and information to prepare, in good form, an income statement, statement of retained earnings, and balance sheet for Clay Enterprises for the year ended December 31, 2011.
Accts Payable:$4,800
Accts Rec.:600
Buildings:56,000
Cash:26,200
Commissions Earned:20,500
Common Stock:50,000
Dividends:3,000
Insurance Expense:1,000
Land:$39,000
Notes Payable:6,000
Rent Expense:3,000
Salaries Expense:8,400
Supplies:400
Interest Expense:600
Income Tax Expense:1,500
Accumulated Depreciation(Building):4,000
Explanation / Answer
Income Statement
At the end of December 31, 2009
Sales
$850,000
Less: Cost of Goods Sold
($266,000)
Gross Profit
$584,000
Less: Selling and Administrative Expenses:
Salaries Paid
($100,000)
Advertising expenses
($11,500)
CEO's Salary
($250,000)
Suppliess expense
($4500)
($366,000)
Less: Depreciation Expenses
($100,000)
Net Income
$118,000
Less: Dividends
$0
Retained Earnings
$118,000
Income Statement
At the end of December 31, 2009
Sales
$850,000
Less: Cost of Goods Sold
($266,000)
Gross Profit
$584,000
Less: Selling and Administrative Expenses:
Salaries Paid
($100,000)
Advertising expenses
($11,500)
CEO's Salary
($250,000)
Suppliess expense
($4500)
($366,000)
Less: Depreciation Expenses
($100,000)
Net Income
$118,000
Less: Dividends
$0
Retained Earnings
$118,000
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