3 Using the amounts from the adjusted trial balance, complete the financial statements for the year ended December 31, 2019. Adj. # 1 2 Account 3 4 Cash in bank 5 Accounts receivable 6 Parts inventory 7 Corp. income tax receivable 8 Land 9 Building 10 Accumulated dep'n bldg. 11 Trade accounts payable 12 Interest payable 13 Estimated current liabilities 14 15 Estimated warranty liability 16 Salaries payable 17 Employee inc, taxes pay. 18 FICA SOC. Sec. pay. 19 20 FICA Medicare payable 21 Trial Balance At December 31, 2019 Unadjusted TB Adjustments Debit Credit Adj. # Debit Credit 74,000 760,000 5,400 210,000 489,600 10,000,000 7,900,000 1,580,000 140,000 40,000 300 Adjusted TB Debit Credit 74,000 765,400 210,000 489,600 10,000,000 7,900,000 1,580,000 100,000 300 136,000 271,100 7,800 1,200 800 135,100 7,800 1,200 800 400 400 800 800 1,000 400 40,000 40,000 151,111 21 22 Co. health insurance payable 23 24 Corp. income tax payable 25 Sales tax payable 26 Note payable 27 Unearned rent revenue 28 Mortgage payable 29 Common stock, $1 per sh. 30 Retained earnings 31 Rent revenue 32 Sales, net 33 Cost of goods sold 34 Bad debts expense 35 Co. health ins expense 36 Delivery expense 37 Dep'n expense-building 38 FICA Soc. Sec. ex 39 FICA Medicare exp. 40 Interest and bank charges 1,632,000 9,000,000 2,963,800 520,000 13,600,000 1,400 40,000 40,000 1,480,889 9,000,000 2,963,800 480,000 13,605,000 40,000 5,000 400 8,704,000 3,000 18,400 300,000 1,000 18,400 9,200 50,000 8,704,000 3,000 18,800 300,000 1,000 18,800 9,400 50,300 400 200 300 Red Art 151,111 30,000 41 Interest on long-term debt 42 Lawsuit damages expense 43 Office supplies expense 4 Professional fees 45 Salaries expense 46 Warranty expense 47 Corp. income tax exp. 48 163,200 0 99,000 40,000 460,000 1,000 489,600 29,436,800 12,089 30,000 99,000 40,000 470,000 272,100 10,000 271,100 489,600 29,436,800 49 ABC D 1 Morgan Manufacturing Corp. 2 Income Statement 3 For the Year Ended December 31, 2019 4 2019 2018 5 Sales, net $13,605,000 $12,756,800 6 Less: Cost of goods sold 8,704,000 9,017,344 7 Gross profit 4,901,000 3,739,456 8 Operating expenses 9 Selling 10 Salaries and benefits 532,510 11 Delivery 282,510 12 Office supplies 99,000 13 Warranty 247,520 14 Total selling 1,161,030 15 General and administrative 16 Bad debts 2,790 17 Depreciation 940 18 Lawsuit damages 19 Professional fees 143,000 20 Total general and adminstrative 21 Total operating expenses 146,730 22 Income from operations 1,307,760 22 Otherine 2,431,696 Ren 499,200 2,930,896 177,243 2,753,653 275,365 $2,478,288 23 Other income 24 Rent revenue 25 Income before interest and income taxes 26 Interest expense 27 Income before income taxes 28 Income taxes 29 Net income 30 31 Morgan Manufacturing Corp. 32 Statement of Changes in Equity 33 For the Year Ended December 31, 2019 34 2019 35 Common Retained 36 stock earnings Total equity 37 Balance at lan 1 $9,000,000 $2,963,800 $11,963,800 38 Net income 39 Balance at Dec. 31 $9,000,000 40 2018 Total equity $9,485,512 2,478,288 $11,963,800 41 Morgan Manufacturing Corp. Balance Sheet At December 31, 2019 42 43 44 45 46 47 2019 Assets Current Cash Accounts receivable, net Corporate income taxes receivable Inventories 2018 $41,970 640,000 48 49 168,012 849,982 50 51 52 53 54 55 56 57 Non-current Land Building, net 23,166.245 6,321,000 29,487,245 $30,337,227 ABC 58 Liabilities 59 Current 60 Trade accounts payable 61 Estimated current liabilities 62 Estimated warranty liabilities 63 Note payable Interest payable 65 Salaries and benefits payable 66 Sales tax payable 67 Unearned rent 68 Current portion of mortgage payable 69 Corporate income taxes payable 70 $108,150 84,600 126,900 0 297 10,340 1,540 41,600 180,000 553,427 71 Non-current Mortgage payable Less: Current portion 72 73 74 75 76 77 78 79 18,000,000 (180,000) 17,820,000 18,373,427 Total liabilities Stockholders'Equity Common stock Retained earnings 80 9,000,000 2,963,800 11,963,800 $30,337,227 81 Total liabilities and S/H equity 82 83 R4