Question

Loren Satina is the sole owner of Clear View park,a public camping ground near the lake mead national recreation area.loren has compiled  the following financial information as of December 31,2017

Particulars	Amount$
Revenues during 2017 -camping fees	1,40,000
Revenues during 2017 - Generla store	65,000
Accounts payable	11,000
Original cost of equipment	1,05,500
Cash on hand	23,000
Fair value of equipment	1,40,000
Notes payable	60,000
Expenses during 2017	1,50,000
Accounts Receivable	17,500

Instructions

(a) Determine Loren Satina's Net income from clear view park for 2017

(b) Prepare a Balance Sheet for clear view park as of December 31,2017

Answer 1

Clear View Company

Income Statement

For the Year ended December 31,2017

Particulars	Amount$	Amount$
Revenues - Camping fees	1,40,000
Revenues - General Store	65,000
Total Revenue		2,05,000
Less : Expenses		1,50,000
Net income		55,000

 

Req (b)

Clear View Company

Balance Sheet

As on December 31,2017

Assets	Amount$	Amount$
Current Assets :
Cash	23,000
Accounts Receivable	17,500
Total Current Assets		40,500
Property,Plant & Equipment
Equipment	1,05,500
Total Property,Plant & Equipment		1,05,500
Total Assets		1,46,000
Liabilities
Current Liabilities :
Notes payable	60,000
Accounts Payable	11,000
Total Current Liabilities		71,000
Stockholder's Equity
Owner's Equity	75,000
Total Stockholder's Equity		75,000
Total Liabilities & Stockholder's Equity		1,46,000

 

Calculation of Owner's Equity

Owner's Equity = Total assets - Total liabilities

                         = $1,46,000 - $71,000

                         = $75,000

 

Net income of Clear view park  for the year ended on December 31,2017 is $55,000

Debit and credit side of the balance sheet of clear view park for the year ended on December 31,2017 are $146,000