2:24 PM 11/25/17 Accrual Basis THE MAIN STREET CASUALS SHOPPE, INC Adjusted Tria

Question

2:24 PM 11/25/17 Accrual Basis THE MAIN STREET CASUALS SHOPPE, INC Adjusted Trial Balance February 27, 2016 Feb 29, 16 Debit Credit 146,911.64 101,000.00 2,500.00 3,000.00 300,000.00 100,000.00 40,000.00 10000 Cash in Bank- Flushing Bank 10500 Inventory 10600 Accounts Receivable 11000 Prepaid Advertising 14000 Building 14500 Land 14600 Furniture and Fixtures 17100 Accumulated Depreciation- Build 22500 Accounts Payable 22600 Accrued Utilities Payable 22700 Accrued Interest Payable 22800 Accrued Salaries Payable 22900 Accrued Income Tax Payable 23000 Unearned Rent Revenue 25000 Note Payable- Flushing Bank 30100 Capital Stock 45000 Sales 5000 Cost of Goods Sold 60500 Advertising Epense 62450 Depreciation Expense. Building 63400 Interest Expense 65000 Salary Expense 68700 Utility Expense 69000 Income Tax Expense 48400 Rental Income 2,000.00 100,000.00 800.00 1,668.49 100.00 6,169.00 8,000.00 350,000.00 200,000.00 128,500.00 89,000.00 ,000.00 2,000.00 3,106.85 3,100.00 1,450.00 6,169.00 2,000.00 TOTAL 799,237.49 799,237.49 Using the adjusted trial balance above, prepare 1. The Income Statement, Statement of Retained Earnings and the Balance Sheet for The 2. Prepare the 3 closing entries. Since there are no dividends, a closing entry to transfer 3. Prepare an After Closing Trial Balance. DO NOT post the closing entries to your Main Street Casuals Shoppe, Inc. You should include a separate section for Gross Profit. the dividends declared is not necessary. previously prepared general ledger. You need only to update the retained earnings (which is zero thru the adjusted T/B). Remember, on an After Closing Trial Balance, the temporary accounts do not exist.

Explanation / Answer

THE MAIN STREET CASUALS SHOPPE 1) INCOME STATEMENT Sales 128500.00 Cost of goods sold 89000.00 Gross profit 39500.00 Operating expenses: Advertising expense 1000.00 Depreciation expense-Building 2000.00 Salary expense 3100.00 Utility expense 1450.00 Total operating expenses 7550.00 Operating profit 31950.00 Other Income/(Expense): Rental income 2000.00 Interest expense -3106.85 -1106.85 Income before taxes 30843.15 Income tax expense 6169.00 Net income 24674.15 BALANCE SHEET ASSETS Current assets: Cash in bank-Flushing Bank 146911.64 Inventory 101000.00 Accounts Receivable 2500.00 Prepaid advertising 3000.00 Total current assets 253411.64 253411.64 Non-Current Assets: Property, Plant and Equipments: Land 100000.00 Building 300000.00 Accumulated depreciation-Building 2000.00 298000.00 Furniture and fixtures 40000.00 Total non current assets 438000.00 Total assets 691411.64 TOTAL LIABILITIES & STOCKHOLDERS' EQUITY Current liabilities: Accounts payable 100000.00 Accrued utilities payable 800.00 Accrued interest payable 1668.49 Accrued salaries payable 100.00 Accrued income tax payable 6169.00 Unearned rent revenue 8000.00 Total current liabilities 116737.49 Non-Current liabilities: Note payable-Flushing Bank 350000.00 Total liabilities 466737.49 Stockholders' Equity: Capital stock 200000.00 Retained earnings 24674.15 Total stockholders' equity 224674.15 Total liabilities and stockholders' equity 691411.64 2) Sales 128500.00 Rental income 2000.00 Income summary 130500.00 (To close revenue and income accounts) Income summary 105825.85 Cost of goods sold 89000.00 Advertising expense 1000.00 Depreciation expense-Building 2000.00 Salary expense 3100.00 Utility expense 1450.00 Interest expense 3106.85 Income tax expense 6169.00 (To close expense accounts) Income summary 24674.15 Retained earnings 24674.15 (To close income summary) 3) POST CLOSING TRIAL BALANCE Debit Credit Cash in bank-Flushing Bank 146911.64 Inventory 101000.00 Accounts Receivable 2500.00 Prepaid advertising 3000.00 Land 100000.00 Building 300000.00 Accumulated depreciation-Building 2000.00 Furniture and fixtures 40000.00 Accounts payable 100000.00 Accrued utilities payable 800.00 Accrued interest payable 1668.49 Accrued salaries payable 100.00 Accrued income tax payable 6169.00 Unearned rent revenue 8000.00 Note payable-Flushing Bank 350000.00 Capital stock 200000.00 Retained earnings 24674.15 693411.64 693411.64

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