Question

Following is a trial balance for Nadia Day Care, as of July 31, 2013, the end of its first month of business. Based on the trial balance, prepare an income statement for the month ended July 31, 2013, and a balance sheet as of July 31, 2013.

                                                                                                              Debits      Credits

            Cash                                                                                       $27,400

            Accounts receivable                                                                      500

            Prepaid rent                                                                                2,500

            Equipment                                                                                  6,000

            Accumulated depreciation, equipment                                                        $100

            Accounts payable                                                                                            300

            Salaries payable                                                                                              240

            Interest payable                                                                                               133

            Notes payable                                                                                           20,000

            Capital                                                                                   10,000

            Revenues                                                                                                  11,500

            Operating expense                                                                     1,000

            Salary expense                                                                           1,840

            Utility expense                                                                              300

            Interest expense                                                                            133

            Rent expense                                                                              2,500

            Depreciation expense                                                                    100                  

                 Totals                                                                                $42,273     $42,273

Answer 1

Answer- Nadia Day Care

Income Statement

For the Month Ended July 31,2013

Revenue		$11,500
Expenses:-
Operating Expenses	$1,000
Salary Expenses	1,840
Utility Expenses	300
Interest Expenses	133
Rent Expenses	2,500
Depreciation Expenses	100
Total Expenses		$5,873
Net Income		$5,627

Nadia Day Care

Statement of Changes in Owner's Equity

For the Month Ended July 31,2013

Capital July 1,2013	$0
Investment during July	10,000
Net Income for July	5,627
Capital July 31,2013	$15,627

Nadia Day Care

Balance Sheet

July 31,2013

Assets:
Cash		$27,400
Accounts Receivable		500
Prepaid Rent		2,500
Equipment	6,000
Less: Accumulated Depreciation	100	5,900
Total Assets		$36,300
Liabilities and Equity :
Liabilities:
Accounts Payable		300
Salaries Payable		240
Interest Payable		133
Notes Payable		20,000
Total Liabilities		$20,673
Capital		15,627
Total Liabilities and Equity		$36,300