Question

This alphabetized adjusted trial balance is for GalaVu Entertainment as of its December 31, 2020, year-end:

		Debit				Credit
Accounts payable					$	44,200
Accounts receivable	$	18,900
Accumulated depreciation, automobiles						69,200
Accumulated depreciation, equipment						20,700
Advertising expense		9,200
Automobiles		142,000
Cash		11,200
Depreciation expense, automobiles		13,400
Depreciation expense, equipment		4,300
Equipment		66,000
Revenue						243,975
Interest income						250
Interest expense		3,700
Interest payable						100
Interest receivable		200
John Conroe, capital						23,200
John Conroe, withdrawals		19,200
Land		36,000
Long-term notes payable						117,000
Notes receivable (due in 90 days)		81,000
Office supplies		4,200
Office supplies expense		13,200
Repairs expense, automobiles		8,600
Salaries expense		76,425
Salaries payable						5,700
Unearned revenue						11,200
Wages expense		28,000
Totals	$	535,525			$	535,525

Required:
Use the information in the trial balance to prepare:

a. The income statement for the year ended December 31, 2020.

 

 

b. The statement of changes in equity for the year ended December 31, 2020, assuming that the owner made additional investments of $16,000 during the year.

 

c. The balance sheet as of December 31, 2020. (Be sure to list the assets and liabilities in order of their liquidity.)

Answer 1

GalaVu Entertainment
Income Statement
For the year ended Dec 2020
Revenues:
Revenues		$243,975
Total Revenues		$243,975
Operating Expenses:
Advertsing Expense	$9,200
Depreciation Expense, Automobiles	$13,400
Depreciation Expense, Equipment	$4,300
Office Supplies Expense	$13,200
Repairs Expense, Automobiles	$8,600
Salaries Expense	$76,425
Wages Expense	$28,000	$153,125
Operating Income		$90,850
Non Operating Items:
Interest Income	$250
Interest Expense	-$3,700	-$3,450
Net Income		$87,400

 

Statement of Owner's Equity
For the year ended December 31, 2020
John Conroe, Capital	$23200
Add: Net Income	$87400
	$110600
Less: Withdrawals	-$19200
	$91400

Balance Sheet
As at 31.12.2020
Assets	Amount ($)	Amount ($)	Liabilities	Amount ($)	Amount ($)
Current Assets:			Current Liabilites:
Cash	$11,200		Accounts Payable	$44,200
Notes Receivable	$81,000		Interest Expense	$100
Interest Receivable	$200		Salaries Payable	$5,700
Accounts Receivable	$18,900		Unearned revenue	$11,200
Office Supplies	$4,200				$61,200
		$115,500	Non Current Liabilities:
Non Current Assets:			Long Term Notes Payable		$117,000
Land	$36,000
Automobiles	$142,000
Less: Accu. Dep	-$69,200		Owner's Equity:
Equipment	$66,000		John Conroe, Capital		$91,400
Less: Accu. Dep	-$20,700	$154,100
Total Assets		$269,600	Total Liabilities and Equity		$269,600

Net Income: $87,400

Ending Capital: $91,400

Balance Sheet sides: $269,600