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Balance sheet Accounts

Cash Accounts receivable

__________________________ __________________________

1/1 Bal. 30,000 1/1 Bal. 15,000

a. 70,000 50,000 d. a. 30,000 27,300 b.

b. 27,300 24,000 e.

c. 10,000 15,000 f.

2,500 g.

_______________ _______________

12/31 Bal. 45,800 12/31 Bal. 17,700

 

Equipment Allow. for uncollectible accounts

__________________________ __________________________

1/1 Bal. 20,000 500 1/1 Bal.

f. 15,000 1,000 Adjusting

_______________ _______________

Bal. 35,000 1,500 12/31 Bal.

 

Accumulated depreciation Salaries payable

__________________________ __________________________

6,000 1/1 Bal. 9,000 1/1 Bal.

2,000 Adjusting d. 9,000 1,000 Adjusting

_______________ _______________

8,000 12/31 Bal. 1,000 12/31 Bal.

 

Common stock Retained earnings

__________________________ __________________________

40,000 1/1 Bal. 9,500 1/1 Bal.

10,000 c. g. 2,500

 

_______________ _______________

50,000 12/31 Bal. 7,000 12/31 Bal.

Problem 2-6 (continued)

InCOME STATEMENT Accounts

Service revenue Miscellaneous expenses

__________________________ __________________________

0 1/1 Bal. 1/1 Bal. 0

100,000 a. e. 24,000

_______________ _______________

100,000 12/31 Bal. 12/31 Bal. 24,000

 

Depreciation expense Bad debt expense

__________________________ __________________________

1/1 Bal. 0 1/1 Bal. 0

Adjusting 2,000 Adjusting 1,000

_______________ _______________

12/31 Bal. 2,000 12/31 Bal. 1,000

 

Salaries expense

__________________________

1/1 Bal. 0

d. 41,000

Adjusting 1,000

_______________

12/31 Bal. 42,000

Problem 2-6 (continued)

Requirement 6

         
Account Title Debits   Credits  
Cash 45,800      
Accounts receivable 17,700      
Allowance for uncollectible accounts     1,500  
Equipment 35,000      
Accumulated depreciation     8,000  
Salaries payable     1,000  
Common stock     50,000  
Retained earnings     7,000  
Service revenue     100,000  
Salaries expense 42,000      
Miscellaneous expenses 24,000      
Depreciation expense 2,000      
Bad debt expense 1,000   ______  
Totals 167,500   167,500  
         

Requirement 7

     
KARLIN COMPANY
Income Statement
For the Year Ended December 31, 2011
     
Service revenue .......................................   $100,000
     
Operating expenses:    
Salaries ............................................... $42,000  
Miscellaneous ..................................... 24,000  
Depreciation ....................................... 2,000  
Bad debt ............................................. 1,000  
Total operating expenses ......   69,000
Net income ..............................................       $ 31,000  
         

Problem 2-6 (continued)

 

       
KARLIN COMPANY
Balance Sheet
At December 31, 2011
       
Assets      
       
Current assets:      
Cash .......................................................   $45,800  
Accounts receivable ............................... $17,700    
Less: Allowance for uncollectible accounts (1,500) 16,200  
Total current assets ............................   62,000  
       
Property and equipment:      
Equipment ............................................. 35,000    
Less: Accumulated depreciation ............. (8,000) 27,000  
Total assets .......................................   $89,000  
       
Liabilities and Shareholders' Equity
       
Current liabilities:      
Salaries payable .....................................   $ 1,000  
Total current liabilities .......................   1,000  
       
Shareholders’ equity:      
Common stock ....................................... $50,000    
Retained earnings ................................... 38,000*    
Total shareholders’ equity .................   88,000  
Total liabilities and shareholders’ equity   $89,000  
       
           

 

*Beginning balance of $9,500 plus net income of $31,000 less dividends of $2,500.

Problem 2-6 (continued)

Requirement 8

 

December 31, 2011

Service revenue......................................................... 100,000

Income summary................................................... 100,000

 

Income summary....................................................... 69,000

Salaries expense.................................................... 42,000

Miscellaneous expenses......................................... 24,000

Depreciation expense............................................ 2,000

Bad debt expense.................................................. 1,000

 

Income summary....................................................... 31,000

Retained earnings.................................................. 31,000

 

 

Problem 2-6 (continued)

Balance sheet Accounts

Cash Accounts receivable

__________________________ __________________________

1/1 Bal. 30,000 1/1 Bal. 15,000

a. 70,000 50,000 d. a. 30,000 27,300 b.

b. 27,300 24,000 e.

c. 10,000 15,000 f.

2,500 g.

_______________ _______________

12/31 Bal. 45,800 12/31 Bal. 17,700

 

Equipment Allow. for uncollectible accounts

__________________________ __________________________

1/1 Bal. 20,000 500 1/1 Bal.

f. 15,000 1,000 Adjusting

_______________ _______________

Bal. 35,000 1,500 12/31 Bal.

 

Accumulated depreciation Salaries payable

__________________________ __________________________

6,000 1/1 Bal. 9,000 1/1 Bal.

2,000 Adjusting d. 9,000 1,000 Adjusting

_______________ _______________

8,000 12/31 Bal. 1,000 12/31 Bal.

 

Common stock Retained earnings

__________________________ __________________________

40,000 1/1 Bal. 9,500 1/1 Bal.

10,000 c. g. 2,500

31,000 Closing

_______________ _______________

50,000 12/31 Bal. 38,000 12/31 Bal.

Problem 2-6 (continued)

InCOME STATEMENT Accounts

Service revenue Miscellaneous expenses

__________________________ __________________________

0 1/1 Bal. 1/1 Bal. 0

100,000 a. e. 24,000

Closing 100,000 24,000 Closing

_______________ _______________

0 12/31 Bal. 12/31 Bal. 0

 

Depreciation expense Bad debt expense

__________________________ __________________________

1/1 Bal. 0 1/1 Bal. 0

Adjusting 2,000 Adjusting 1,000

2,000 Closing 1,000 Closing

_______________ _______________

12/31 Bal. 0 12/31 Bal. 0

 

Date: 2015-12-11; view: 1331

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