Income Statement, Statement of Retained Earnings, and Balance Sheet The followin
ID: 2355199 • Letter: I
Question
Income Statement, Statement of Retained Earnings, and Balance Sheet The following list, in alphabetical order, shows the various items that regularly appear on the financial statements of Maple Park Theatres Corp. The amounts shown for balance sheet items are balances as of September 30, 2012 (with the exception of retained earnings, which is the balance on September 1, 2012), and the amounts shown for income statement items are balances for the month ended September 30, 2012. Accounts payable $17,600 Furniture and fixtures $34,000 Accounts receivable 6,410 Land 26,000 Advertising expense 14,500 Notes payable 20,000 Buildings 60,000 Projection equipment 25,000 Capital stock 50,000 Rent expenseExplanation / Answer
Placement of each account should be as follows. Note IS = Income Statement; BS = Balance Sheet. Accounts payable $17,600 (BS-Current Liabilities) Accounts Receivable $6,410 (BS-Current Assets) Advertising Expense $14,500 (IS-Expenses) Buildings $60,000 (BS-Long term assets) Capital Stock $50,000 (BS-Stockholder's equity) Cash $15,230 (BS-Current Assets) Concessions Revenue $60,300 (IS-Revenues) Cost of concessions sold $23,450 (IS-Expenses) Dividends paid during the month $8,400 (BS- Subtract from Stockholder's Equity) Furniture and fixtures $34,000 (BS-Long term assets) Land $26,000 (BS-Long term assets) Notes payable $20,000 (BS-Long term liabilities) Projection Equipment $25,000 (BS-long term assets) Rent expense - movies $50,600 (IS-Expenses) Retained Earnings $73,780 (BS-Stockholder's Equity) Salaries and wages expense $46,490 (IS-Expenses) Ticket Sales $95,100 (IS-Revenues) Water, gas and electricity $6,700 (IS-Expenses) Do your income statement first. You should have a net income of $13,600. Add this to retained earnings. If you add up all the stockholder's equity (making sure to add the net income and subtract the dividends paid) the amount should equal $129,040. Add this amount to total liabilities and the amount should be $166,640, which is the same as total assets.