Question

Lamp Light Company maintains and repairs warning lights, such as those found on radio towers and lighthouses. Lamp Light Company prepared the following end-of-period spreadsheet at December 31, 2018, the end of the fiscal year:

	Lamp Light Company
	End-of-Period Spreadsheet
	For the Year Ended December 31, 2018
	Unadjusted Trial Balance		Adjustments		Adjusted Trial Balance
Account Title	Dr.	Cr.	Dr.	Cr.	Dr.	Cr.
Cash	10,800.00				10,800.00
Accounts Receivable	38,900.00		(a) 11,300.00		50,200.00
Prepaid Insurance	4,200.00			(b) 3,000.00	1,200.00
Supplies	2,730.00			(c) 2,250.00	480.00
Land	98,000.00				98,000.00
Building	400,000.00				400,000.00
Accumulated Depreciation-Building		205,300.00		(d) 10,100.00		215,400.00
Equipment	101,000.00				101,000.00
Accumulated Depreciation-Equipment		85,100.00		(e) 6,680.00		91,780.00
Accounts Payable		15,700.00				15,700.00
Salaries and Wages Payable				(f) 4,900.00		4,900.00
Unearned Rent		2,100.00	(g) 1,300.00			800.00
Common Stock		75,000.00				75,000.00
Retained Earnings		128,100.00				128,100.00
Dividends	10,000.00				10,000.00
Fees Earned		363,700.00		(a) 11,300.00		375,000.00
Rent Revenue				(g) 1,300.00		1,300.00
Salaries and Wages Expense	163,100.00		(f) 4,900.00		168,000.00
Advertising Expense	21,700.00				21,700.00
Utilities Expense	11,400.00				11,400.00
Depreciation Expense-Building			(d) 10,100.00		10,100.00
Repairs Expense	8,850.00				8,850.00
Depreciation Expense-Equipment			(e) 6,680.00		6,680.00
Insurance Expense			(b) 3,000.00		3,000.00
Supplies Expense			(c) 2,250.00		2,250.00
Miscellaneous Expense	4,320.00				4,320.00
	875,000.00	875,000.00	39,530.00	39,530.00	907,980.00	907,980.00

Required:

1.	Prepare an income statement for the year ended December 31, 2018. If a net loss has been incurred, enter that amount as a negative number using a minus sign. Be sure to complete the statement heading. Use the list of Labels and Amount Descriptions for the correct wording of text items other than account names. You will not need to enter colons (:) on the income statement.
2.	Prepare a retained earnings statement for the year ended December 31, 2018. If a net loss is incurred or dividends were paid, enter that amount as a negative number using a minus sign. Be sure to complete the statement heading. Refer to the list of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. Refer to the Chart of Accounts for exact wording of account titles.
3.	Prepare a balance sheet as of December 31, 2018. Fixed assets must be entered in order according to account number. Be sure to complete the statement heading. Refer to the list of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. Refer to the Chart of Accounts for exact wording of account titles. For those boxes in which you must enter subtracted or negative numbers use a minus sign.
4.	Based upon the end-of-period spreadsheet, journalize the closing entries. Refer to the Chart of Accounts for exact wording of account titles.
5.	Prepare a post-closing trial balance.

Chart of Accounts

CHART OF ACCOUNTS
Lamp Light Company
General Ledger
ASSETS 11 Cash 12 Accounts Receivable 13 Prepaid Insurance 14 Supplies 15 Land 16 Building 17 Accumulated Depreciation-Building 18 Equipment 19 Accumulated Depreciation-Equipment LIABILITIES 21 Accounts Payable 22 Salaries and Wages Payable 23 Unearned Rent EQUITY 31 Common Stock 32 Retained Earnings 33 Dividends 34 Income Summary	REVENUE 41 Fees Earned 42 Rent Revenue EXPENSES 51 Salaries and Wages Expense 52 Advertising Expense 53 Utilities Expense 54 Depreciation Expense-Building 55 Repairs Expense 56 Depreciation Expense-Equipment 57 Insurance Expense 58 Supplies Expense 59 Miscellaneous Expense

Labels and Amount Descriptions

Labels
Current assets
Current liabilities
December 31, 2018
Expenses
For the Year Ended December 31, 2018
Property, plant, and equipment
Revenues
Amount Descriptions
Book value-building
Book value-equipment
Change in retained earnings
Net income
Net loss
Retained earnings, December 31, 2018
Retained earnings, January 1, 2018
Total assets
Total current assets
Total expenses
Total liabilities
Total liabilities and stockholders’ equity
Total property, plant, and equipment
Total revenues
Total stockholders’ equity

Income Statement

1. Prepare an income statement for the year ended December 31, 2018. If a net loss has been incurred, enter that amount as a negative number using a minus sign. Be sure to complete the statement heading. Use the list of Labels and Amount Descriptions for the correct wording of text items other than account names. You will not need to enter colons (:) on the income statement.

Lamp Light Company

Income Statement

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16

Retained Earnings Statement

2. Prepare a retained earnings statement for the year ended December 31, 2018. If a net loss is incurred or dividends were paid, enter that amount as a negative number using a minus sign. Be sure to complete the statement heading. Refer to the list of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. Refer to the Chart of Accounts for exact wording of account titles.

Lamp Light Company

Retained Earnings Statement

1
2
3
4
5

Balance Sheet

3. Prepare a balance sheet as of December 31, 2018. Fixed assets must be entered in order according to account number. Be sure to complete the statement heading. Refer to the list of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. Refer to the Chart of Accounts for exact wording of account titles. For those boxes in which you must enter subtracted or negative numbers use a minus sign.

Lamp Light Company

Balance Sheet

1	Assets
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18	Liabilities
19
20
21
22
23
24	Stockholders’ Equity
25
26
27
28

Journal

4. Based upon the end-of-period spreadsheet, journalize the closing entries. Refer to the Chart of Accounts for exact wording of account titles.

PAGE 11

JOURNAL

ACCOUNTING EQUATION

	DATE	DESCRIPTION	POST. REF.	DEBIT	CREDIT	ASSETS	LIABILITIES	EQUITY
1		Closing Entries
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18

Post-Closing Trial Balance

5. Prepare a post-closing trial balance.

Lamp Light Company

POST-CLOSING TRIAL BALANCE

December 31, 2018

	ACCOUNT TITLE	DEBIT	CREDIT
1	Cash
2	Accounts Receivable
3	Prepaid Insurance
4	Supplies
5	Land
6	Building
7	Accumulated Depreciation-Building
8	Equipment
9	Accumulated Depreciation-Equipment
10	Accounts Payable
11	Salaries and Wages Payable
12	Unearned Rent
13	Common Stock
14	Retained Earnings
15	Totals

Answer 1

1)iNCome statement :

Fees earned	375000
Rent revenue	1300
Total revenue		376300
less:operating expenses
salaries and wage expense	168000
advertising	21700
utilities	11400
depreciation-building	10100
repairs	8850
depreciation-equipment	6680
insurance	3000
supplies	2250
misc.expense	4320	236300
net income		140000

2)Retained earning

Beginning balance	128100
Add:net income	140000
less:dividend	-10000
Retained earning at end	258100

3)Balance sheet:

current asset
cash	10800
Accounts receivable	50200
prepaid insurance	1200
supplies	480
Total current asset		62680
Plant asser
Land	98000
building	400000
less accumulated depreciation	- 215400
Equipment	101000
less:accumulated depreciation	-91780
Total plant asset		291820
Total asset		354500
Liabilities and equity
Accounts payabe	15700
salaries and wages payable	4900
unearned rent revenue	800
Total liabilities		21400
equity
common stock	75000
Retained earning	258100
Total equity		333100
Total liabilities and equity		354500

4)

Date	Account	debit	credit
1	Fee earned	375000
	rent revenue	1300
	Income statement		376300
	[Being revenue earned closed]
2	Income statment	236300
	salaries and wage expense		168000
	advertising expense		21700
	utilities expense		11400
	depreciation-building		10100
	repairs expense		8850
	depreciation- equipment		6680
	insurance expense		3000
	supplies expense		2250
	miscellaneous expense		4320
	[To close expenses]
3	Income statement	140000
	Retained earning		140000
	[to close net income]
4	Retained earning	10000
	dividend		10000
	[To close dividend]