Question

Kang Company was organized on April 1, 2020. The company prepares quarterly financial statements. The adjusted trial balance amounts at June 30 are shown below (amounts in millions).

Debit	Credit
Cash ₩ 6,700	Accumulated Depreciation –
Accounts Receivable 600	Equipment ₩ 850
Prepaid Rent   900	Notes Payable 5,000
Supplies 1,000	Accounts Payable 1,510
Equipment 15,000	Salaries and Wages Payable 400
Dividends 600	Interest Payable 50
Salaries and Wages Expense 9,400	Unearned Rent Revenue 500
Rent Expense 1,500	Share Capital-Ordinary 14,000
Depreciation Expense 850	Service Revenue 14,200
Supplies Expense   200	Rent Revenue 800
Utilities Expense 510
Interest Expense    50
₩ 37,310	₩ 37,310

1. Prepare Income Statement.
2. Prepare Retained Earnings Statement.
3. Prepare Statement of Financial Position.

Answer 1

a. Prepare Income Statement.
Kang Company
Income Statement
For the Quarter ended 30 June,2020
Revenues
Service Revenue	14200
Add: Rent Revenue	800
Total Revenues		15000
Less:Expenses
Salaries & wages Expense	9400
Rent Expense	1500
Depreciation Expense	850
Utilities Expense	510
Supplies Expense	200
Interest Expense	50
Total Expenses		12510
Net Income		2490
a. Prepare Retained Earnings Statement.
Kang Company
Retained Earnings Statement
For the Quarter ended 30 June,2020
Owner's capital ,April 1	0
Add: Share capital-Ordinary	14000
Net Income	2490
Less: Dividends	600
Owner's capital,June 30	15890
a. Prepare Statement of Financial Position.
Kang Company
Statement of Financial Position
June 30,2020
Total Assets	Total Liabilities and Owner's Equity
Cash		6700	Notes payable		5000
Accounts Receivable		600	Accounts payable		1510
Supplies		1000	Unearned rent Revenue		500
Prepaid Rent		900	Salaries & wages payable		400
Equipment	15000		Interest payable		50
Less:Accumulated depreciation -Equipment	850	14150	Total Liabilities		7460
			Owner's Equity
			Owner's capital ,April 1	0
			Add: Share capital-Ordinary	14000
			Net Income	2490
			Less: Dividends	600
			Owner's capital,June 30		15890
Total assets		23350		Total Liabilities & Retained Earnings	23350