Question

Collins Pet Photographic Studio specialises in portraits of domestic pets. The capital balance of L. Collins,
owner of the business, was $50 000 at 30 June 20X8. During 20X9 he withdrew $16 000 for personal use. At
30 June 20X9, the business’s accounting records show these balances:

Accounts receivable $ 8 0110 Bent expense $ 7 000

Loan 12 000 Cash at bank 16 000
L. Collins, capital ? Accounts payable 6 000
Salary expense 22 000 Advertising expense 4 000

Equipment 65 000 Service revenue 70 000

Prepare the following financial statements for Collins Pet Photographic Studio:
a. Income statement for the year ended 30 June 20X9

b. Statement of changes in equity for the year ended 30 June 20X9

c. Balance sheet as at 30 June 20X9

Answer 1