CUMULATIVE REVIEW PROBLEM: CHA The purpose of this problens proeide an 2 is to p
ID: 2330169 • Letter: C
Question
CUMULATIVE REVIEW PROBLEM: CHA The purpose of this problens proeide an 2 is to procide an opportunity to recierc both ne jor concepts in precious chapters. This cumulatice ecie aept, ts the me both new concepts is the curt shoald anist you in ccounting concepts and preparing for exanu was formed on January 1, 2011. The foll Coltien is taken fromthe counting records on Decemel he Lalu Company accounting records ber 31, 2011 $ 5,000 Accounts payable Accounts receivable 12,000 Common stock (issued on January 1, 2011) Land Rent expense Supplies expense Supplies on hand Trucks Wages expense Wages payable REQUIRED: Compute each of the following Hint before answering the individual questions, prepare an income statement, statement of owaers' equity, and a balance sheet from the information above.) 1. The total amount of debit balances at December 31, 201n. 2. The total amount of credit balances at December 31, 2011. 3. Total revenues for year ended December 31, 2011. 4. Total expenses for year ended December 31, 2011. Net income (loss) for year ended December 31, 2011. 6. Retained earnings on January 1, 2011 7. Retained earnings on December 31, 2011. S. Total owners' equity on December 31, 201I 9. Total current assets on December 31, 2011. 10. Total curent liabilities on December 31, 2011. II. Total assets on December 31, 2011 12. Total liabilities and owners' equity on December 31. 3011 5.Explanation / Answer
Answer 1.
Debit Balance = Accounts Receivable + Advertising Expense + Cash + Land + Rent Expense + Supplies Expense + Supplies + Truck + Wages Expense
Debit Balance = $12,000 + $14,000 + $12,000 + $50,000 + $22,000 + $9,000 + $4,000 + $5,000 + $46,000
Debit Balance = $174,000
Answer 2.
Credit Balance = Accounts Payable + Common Stock + Fees Revenue + Wages Payable
Credit Balance = $5,000 + $90,000 + $75,000 + $4,000
Credit Balance = $174,000
Answer 3.
Total Revenues = Fees Revenue
Total Revenues = $75,000
Answer 4.
Total Expenses = Advertising Expenses + Rent Expense + Supplies Expense + Wages Expense
Total Expenses = $14,000 + $22,000 + $9,000 + $46,000
Total Expenses = $91,000
Answer 5.
Net Income (loss) = Total Revenues - Total Expenses
Net Income (loss) = $75,000 - $91,000
Net Income (loss) = -$16,000
Answer 6.
Retained Earnings = Net Income (loss)
Retained Earnings = -$16,000