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13. Given the following information at year end after adjustments Sales Interest Revenue Interest Expense Cost of goods Soid Selling Expense General & Adm.Exp Retained Earnings Beg. Bal. 0 Assets – YE Common Stock YE $10,000 $1,000 $2,000 $4,500 $1,500 $2,800 0 $16,000 $1,000 A. Prepare and income statement for the year. B. Prepare a retained earnings statement for the year. C. What is the value of total liabilities at year end? D. Record closing entries E. Calculate – Total Debt/Stockholders’ Equity
Expert Answer
| A | ||
| Income Statement | ||
| Sales | 10000 | |
| Interest Revenue | 1000 | |
| Total revenues | 11000 | |
| Expenses: | ||
| Cost of goods sold | 4500 | |
| Selling expense | 1500 | |
| General and Admin exp. | 2800 | |
| Total expenses | 8800 | |
| Net income | 2200 | |
| B | ||
| Retained earnings, Beg. Bal. | 0 | |
| Add: Net income | 2200 | |
| Retained earnings, End. Bal. | 2200 | |
| C | ||
| Total liabilities = 16000-1000-2200= | 12800 | |
| D | ||
| Sales | 10000 | |
| Interest Revenue | 1000 | |
| Income Summary | 11000 | |
| Income Summary | 8800 | |
| Cost of goods sold | 4500 | |
| Selling expense | 1500 | |
| General and Admin exp. | 2800 | |
| Income Summary | 2200 | |
| Retained earnings | 2200 | |
| E | ||
| Total debt/Stockholders’ equity = 12800/3200= | 4 | |
