C3-1 Analyzing, Recording, and Posting, and Preparing and Evaluating Financial Statements (Chapters 1-3) [LO 3-2, LO 3-3, LO 3-4, LO 3-5]

[The following information applies to the questions displayed below.]

Vanishing Games Corporation (VGC) operates a massively multiplayer online game, charging players a monthly subscription of $10. At the start of January 2015, VGCs income statement accounts had zero balances and its balance sheet account balances were as follows:

Cash	$	1,810,000
Accounts Receivable		224,000
Supplies		23,400
Equipment		916,000
Land		1,950,000
Building		446,000
Accounts Payable		120,000
Unearned Revenue		91,000
Notes Payable (due 2018)		159,000
Common Stock		2,600,000
Retained Earnings		2,399,400

In addition to the above accounts, VGCs chart of accounts includes the following: Service Revenue, Salaries and Wages Expense, Advertising Expense, and Utilities Expense.

rev: 09_10_2015_QC_CS-23922

5.

Prepare an Income Statement for the month ended January 31, 2015, using unadjusted balances from part 4.

VANISHING GAMES CORPORATION
Income Statement

6.

Prepare a Statement of Retained Earnings for the month ended January 31, 2015, using the beginning balance given above and the net income from part 5. Assume VGC has no dividends.

VANISHING GAMES CORPORATION
Statement of Retained Earnings
For the Month Ended January 31, 2015
Retained Earnings, January 1, 2015
Retained Earnings, January 31, 2015	$0

7.

Prepare a classified Balance Sheet at January 31, 2015, using your response to part 6.

VANISHING GAMES CORPORATION
Balance Sheet
	0
	$0
	0
	0
	0

8.

Calculate net profit margin, expressed as a percent. (Round your answer to 1 decimal place.)

Net Profit Margin

%