Question

Sara’s Bakery had the following account balances at the end of 2016:
Supplies ................. $ 4,000
Wage expense ............. 42,000
Sales ............... 178,000
Cash .................. 24,000
Supplies expense .............. 14,000
Accounts payable ............ 8,000
Rent expense ............. 12,000
Common shares ........... 90,000
Accounts receivable ............ 10,000
Cost of goods sold ......... 101,000
Equipment ............. 87,500
Depreciation expense ........... 2,500
Retained earnings ............ 22,500
Dividends declared ........... 2,000
Prepaid rent ............. 1,000
Wages payable ............ 1,500
Required:
a. Prepare a statement of income for the year ended December 31, 2016.
b. In answering part “a,” you did not need to use all the accounts provided. For each item that you did not use, explain why you did not include it on the statement of income.


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  • CreatedJune 11, 2015
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