Question

On January 1, 2021, Red Flash Photography had the following balances: Cash, $31,000; Supplies, $9,900; Land, $79,000; Deferred Revenue, $6,900; Common Stock $69,000; and Retained Earnings, $44,000. During 2021, the company had the following transactions:

1.		February		15		Issue additional shares of common stock, $39,000.
2.		May		20		Provide services to customers for cash, $54,000, and on account, $49,000.
3.		August		31		Pay salaries to employees for work in 2021, $42,000.
4.		October		1		Paid for one year's rent in advance, $31,000.
5.		November		17		Purchase supplies on account, $41,000.
6.		December		30		Pay dividends, $3,900.

The following information is available on December 31, 2021:

1. Employees are owed an additional $5,900 in salaries.
2. Three months of the rental space has expired.
3. Supplies of $6,900 remain on hand.
4. All of the services associated with the beginning deferred revenue have been performed.

1. Record each of the transactions listed above in the 'General Journal' tab. Review the 'General Ledger' and the 'Trial Balance' tabs to see the effect of the transactions on the account balances.

2. Record the adjusting entries in the 'General Journal' tab.

3. Review the adjusted 'Trial Balance' as of December 31, 2021.

4. Prepare an income statement for the year ended December 31, 2021, in the 'Income Statement' tab.

5. Prepare the statement of Stockholder's Equity for the year ended December 31, 2021, in the 'Income Statement' tab.

6. Prepare a classified balance sheet as of December 31, 2021 in the 'Balance Sheet' tab.

7. Record the closing entries in the 'General Journal' tab.

Answer 1