NewCo sold 100,000 shares of stock (par value 1.00) for $800,000. Purchased machinery for $75,000 signing a long-term note on 3/1 with an interest rate of 5%. Depreciation for the year is $7,000. On 9/1 purchased a year’s worth of rent in advance for $24,000. On 9/1 purchased $20,000 worth of supplies with cash. At the end of the year it was determined that only $5,000 worth of supplies remained.   Newco sold and delivered services for $200,000 on account. Newco also sold and delivered services for cash for $300,000. NewCo received $95,000 at the beginning of December to perform services later, by year-end 20% of the services had been performed. The related bad debt rate is 2% on net total credit sales.   NewCo had paid salaries during the year at $50,000. The next payday is after the year ends. The amount of unpaid salaries for 2016 is $5,000. A utility bill just arrived at year-end for $2,000. We don’t plan on paying for the utilities until next year. We paid a cash dividend of $5,000. Tax rate is 30%.  

* Prepare a formal income statement and balance sheet for NewCo for the year 2016.

* Prepare ALL journal Entries including adjusting entries and Closing Entries

Answer rating: 100% (QA)

Certainly Here are the journal entries adjusting entries and closing entries organized in a table fo... View the full answer