Refer to the information presented in E2-4 for Summit's Bowling Alley Ltd.

Instructions
(a) Calculate profit and the ending balance of retained earnings at December 31, 2012. It is not necessary to prepare a formal income statement or statement of changes in equity.
(b) Prepare a statement of financial position, listing items in order of reverse liquidity. Assume that $13,600 of the mortgage payable will be paid in 2013.

Transcribed Image Text:

Accounts payable Accounts receivable Accumulated depreciation-buildings45,600 Accumulated depreciation-equipment 17,770 Bowling revenue Buildings Cash Common shares Depreciation expense Equipment 14,050 13,780 73,040 128,800 15,040 50,000 13,080 62,400 Income tax expense Interest expense Interest payable Land Long-term investments Mortgage payable Operating expenses Prepaid insurance Retained earnings, Jan. 1 Supplies $ 5,000 4,750 1,600 54,000 30,000 95,000 35,600 390 66,520 740