Question: McMinn Retail Inc is a retailer that has engaged you

McMinn Retail, Inc., is a retailer that has engaged you to assist in the preparation of its financial statements at December 31, 2011. Following are the correct adjusted account balances, in alphabetical order, as of that date. Each balance is the “normal” balance for that account.

a. Prepare an income statement for the year ended December 31, 2011, which includes amounts for gross profit, income before income taxes, and net income. List expenses (other than cost of goods sold and income tax expense) in order, from the largest to the smallest dollar balance. You may ignore earnings per share.
b. Prepare a statement of retained earnings for the year ending December 31, 2011.
c. Prepare a statement of financial position (balance sheet) as of December 31, 2011, following these guidelines:
• Include separate asset and liability categories for those assets which are “current.”
• Include and label amounts for total assets, total liabilities, total stockholders’ equity, and total liabilities and stockholders’ equity.
• Present deferred income taxes as a noncurrent liability.
• To the extent information is available that should be disclosed, include that information in yourstatement.
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