As at 30 June 2022, the Assets, Liabilities, Equity, Income and Expense amounts for Rooney Shop fitters Pty Ltd are presented below:

Cash in Bank	75,000
Accounts payable	145,000
Service income	1,350,000
Prepaid Insurance	60,000
Bank loan	50,000
Accounts receivable	160,000
Capital	?
Retained Earnings	250,000
Salary expense	483,000
Supplies expense	142,500
Advertising expense	15,000
Supplies	84,200
Equipment	256,400

Required:

1. Prepare a Balance Sheet in narrative (vertical) format as at 30 June 2019. (5 marks)

ANSWER a):

2. Explain how the income statement is linked to the balance sheet. (2 marks)

Answer rating: 100% (QA)

Answer P... View the full answer