Question: Preparing an Income Statement Statement of Retained Earnings and Balance Sheet

Preparing an Income Statement, Statement of Retained Earnings, and Balance Sheet
Assume that you are the president of Influence Corporation. At the end of the first year (June 30, 2011) of operations, the following financial data for the company are available:
Cash $13,150
Receivables from customers (all considered collectible) 10,900
Inventory of merchandise (based on physical count and priced at cost) 27,000
Equipment owned, at cost less used portion 66,000
Accounts payable owed to suppliers 31,500
Salary payable for 2011 (on June 30, 2011, this was owed to an
employee who was away because of an emergency; will return
around July 7, 2011, at which time the payment will be made) 1,500
Total sales revenue 100,000
Expenses, including the cost of the merchandise sold (excluding
income taxes) 68,500
Income taxes expense at 30% × pretax income; all paid during 2011 ?
Contributed capital, 5,000 shares outstanding 62,000
No dividends were declared or paid during 2011.
Using the financial statement exhibits in the chapter as models and showing computations:
1. Prepare a summarized income statement for the year ended June 30, 2011.
2. Prepare a statement of retained earnings for the year ended June 30, 2011.
3. Prepare a balance sheet at June 30, 2011.

View Solution:

Sale on SolutionInn
  • CreatedDecember 12, 2011
  • Files Included
Post your question