The adjusted trial balance of Festive Occasions Party Planners at December 31,2008 , follows.

Requirements 

1. Prepare Festive Occasions' 2008 income statement and statement of owner's equity and year-end balance sheet. List expenses in decreasing order on the income statement and show total liabilities on the balance sheet. Draw arrows linking the three financial statements.

2.

a. Which financial statement reports Festive Occasions' results of operations? Were 2008 operations successful? Cite specifics from the financial statements to support your evaluation.

b. Which statement reports the company's financial position? Does Festive Occasions' financial position look strong or weak? Give the reason for your evaluation. 

Transcribed Image Text:

FESTIVE OCCASIONS PARTY PLANNERS Adjusted Trial Balance December 31, 2008 Account Title Cash Accounts receivable Supplies Equipment Balance Debit Credit $ 12,300 10,400 900 25,600 Accumulated depreciation Accounts payable Unearned service revenue $ 12,200 3,600 4,500 Salary payable 900 Note payable 15,000 D. Brooks, capital 10,000 D. Brooks, withdrawals 38,000 Service revenue 63,700 Depreciation expense 5,300 Salary expense 9,000 Utilities expense Insurance expense Supplies expense Total $109,900 $109,900 3,700 3,100 1,600