Question

The amounts of the assets and liabilities of Nordic Travel Agency at December 31, 2020, the end of the year, and its revenue and expenses for the year follow. The capital of Ian Eisele, owner, was $670,000 on January 1, 2020, the beginning of the year. During the year, Ian withdrew $42,000.

Accounts Payable 69,500

Rent Expense 36,000

Accounts Receivable 285,000

Supplies 5,000

Cash 190,500

Supplies Expense 4,100

Fees Earned 912,500

Utilities Expense 28,500

Land 544,000

Wages Expense 510,000

Mis. Expense 6,400  

Prepare an income statement for the year ended December 31,2020.

Prepare a statement of owner’s equity for the year Ended December 31,2020.

Prepare a balance Sheet as of December 31,2020.

Answer 1

Income statement

Revenue
Fees earned		912500
Expense
Rent Expense	36000
Supplies Expense	4100
Utilities Expense	28500
Wages Expense	510000
Mis. Expense	6400
Total expense		585000
Net income		327500

Statement of owner's equity

Beginning Owner's equity	670000
Add: Net income	327500
	997500
Less: Owner's withdrawal	-42000
Ending owner's equity	955500

Balance sheet

Assets
Current assets
Cash	190500
Account receivable	285000
Supplies	5000
Total current assets		480500
Property, plant and equipment
Land	544000
Total Property, plant and equipment		544000
Total Assets		1024500
Liabilities and stockholder's equity
Current liabilities
Account payable		69500
Long term liabilities
Total liabilities		69500
Owner's equity
Owner's capital		955500
Total liabilities and Owner's equity		1025000