Question

On December 31, 2018, the accounts in the ledger of Monroe Entertainment Co. are listed below. All accounts have normal balances. At the beginning of the year, retained earning beginning balance is $3,000.

Cash	$                16,000
Accounts Receivable	6,000
Equipment	12,000
Accumulated Depreciation- Equipment (Credit Balance)	(6,000)
Other Assets	1,000
Accounts Payable	1,800
Long-term Note Payable	10,000
Common Stock	1,000
Sales	50,000
Cost of Goods sold	21,000
Selling Salaries Expense	3,000
Administration Wages Expense	6,000
Depreciation Expense (Office Equipment)	5,000
Interest Expense	800
Dividends	$                   1,000

1. Generate the Multi-Step Income Statement below

2. Generate Retained Earning Statement

3. Generate Balance Sheet

Answer 1

1) Multiple step income statement

Sales		50000
Less: Cost of goods sold		-21000
Gross profit		29000
Less: Operating expense
Selling Salaries Expense	3000
Administration Wages Expense	6000
Depreciation Expense (Office Equipment)	5000
Total expense		-14000
Operating income		15000
Other expense
Interest expense		-800
Net income		14200

Statement of retained earnings

Beginning retained earnings	3000
Add: Net income	14200
Less: Dividend	-1000
Ending retained earnings	16200

Balance sheet

Assets
Current assets
Cash	16000
Account receivable	6000
Total current assets		22000
Non Current assets
Equipment	12000
Less: Accumulated Depreciation- Equipment	-6000	6000
Other assets		1000
Total Assets		29000
Liabilities and stockholder's equity
Current liabilities
Account payable		1800
Long term liabilities
Long term notes payable		10000
Total liabilities		11800
Stockholder's equity
Common Stock	1000
Retained earnings	16200
Total Stockholder's equity		17200
Total liabilities and stockholder's equity		29000