Question

Martinez Company

Worksheet

For the Year Ended December 31, 2019

(e) Prepare a post-closing trial balance. 

Answer 1

Post-Closing Trial Balance:

Martinez Company
Post-Closing Trial Balance
For the Year Ended December 31,2019
Account title	Debit	Credit
Cash	5,300
Accounts receivable	10,700
Supplies	1,600
Prepaid insurance	1,900
Equipment	27,500
Accumulated Depreciation-Equipment		5,100
Notes payable		14,000
Accounts payable		6,100
Salaries and Wages payable		2,100
Interest payable		700
Common stock		9,900
Retained Earnings*		9,100
Total	$47,000	$47,000

*Calculations:

Income Statement
Service revenue		63,200
Expenses:
Advertising expense	8,900
Supplies expense	4,000
Depreciation expense	5,100
Insurance expense	3,600
Salaries and Wages expense	28,400
Interest expense	700
Total Expenses		50,700
Net income		12,500

Retained earnings, Ending balance = Retained earnings, Beginning balance + Net income - Dividends

= 3,400 + 12,500 - 6,800

= 9,100