Following is a list of financial statement items and amounts for Tim Burr’s Tree
ID: 2423606 • Letter: F
Question
Following is a list of financial statement items and amounts for Tim Burr’s Tree Service as of 12/31/X3, the end of its first year in operation. Accounts Receivable $ 42,000 Accounts Payable 32,000 Cash 10,200 Common Stock 22,000 Notes Payable 10,400 Equipment 51,000 Service Revenue 110,000 Fuel Expense 10,200 Rent Expense 11,900 Advertising Expense 5,200 Salaries and Wages Expense 22,000 Retained Earnings ? Dividends 21,900
1. Prepare the Income Statement for the year ended December 31, 20X3.
2. Prepare the statement of retained earnings for the year ended December 31, 20X3.
3. Prepare the balance sheet for the year ended December 31, 20X3.
Explanation / Answer
Data Given in the problem Amount in $ Accounts Receivable 42000 Accounts Payable 32000 Cash 10200 Common Stock 22000 Equipment 51000 Notes Payable 10400 Service Revenue 110000 Fuel Expense 10200 Dividends 21900 Rent Expense 11900 Advertising Expense 5200 Salaries and Wages 22000 Income Statement for the year ended December 31, 20X3 Service Revenue 110000 Less: Fuel Expense 10200 Rent Expense 11900 Advertising Expense 5200 Salaries and Wages 22000 49300 Net income 60700 Note: Ignore depreciation on equipment and tax expense, since there is no information about Depreciation and tax statement of retained earnings for the year ended December 31, 20X3 Net income as per Income statement 60700 Less: Dividends 21900 Retained earnings 38800 Balance sheet for the year ended December 31, 20X3. Liabilities Amount Assets Amount Common Stock 22000 Equipment 51000 Notes Payable 10400 Accounts Receivable 42000 Retained earnings 38800 Cash 10200 Accounts Payable 32000 103200 103200