The Sky Blue Corporation has the following adjusted trial balance at December 31

Question

The Sky Blue Corporation has the following adjusted trial balance at December 31. Debit Credit Cash Accounts Receivable Prepaid Insurance Notes Receivable (long-term) Equipment Accumulated Depreciation Accounts Payable Salaries and Wages Payable ncomne Taxes Pavabl Unearned Revenue Common Stock Retained Earnings Dividends Sales Revenue Rent Revenue Salaries and Wages Expense Depreciation Expense Utilities Expense Insurance Expense Rent Expense Income Tax Expense $ 1,300 2,700 3,000 3,700 15,500 $ 4,000 6,120 1,350 3,600 740 3,100 1,280 370 48,330 370 23,000 2,000 4,920 2,100 6,700 3,600 Total $68,890 $68,890 1. Prepare a classified balance sheet at December 31. (Amounts to be deducted should be indicated by a minus sign.)

Explanation / Answer

The following is the classified balance sheet.

note:

net income = reveues - expenses

=>$48,330 + $370 - 23,000-2,000- 4,920-2,100 - 6,700 - 3,600 =>$6,380

Assets Current assets Cash $1,300 Account receivable $2,700 prepaid insurance $3,000 total current assets $7,000 Notes receivable $3,700 Equipment $15,500 Accumulated depreciation - $4,000 $11,500 Total assets $22,200 Liabilities Current liabilities accounts payable $6,120 salaries and wages payable $1,350 income tax payable $3,600 unearned revenue $740 Total current liabilities $11,810 Stock holder's equity common stock $3,100 Retained earnings ($1,280 + $6,380 net income - $370 dividends) (see note) $7,290 Total stock holders equity $10,390 total liabilities and stock holders equity $22,200

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