Question

Adjusted trial balance to income statement, retained earnings and balance sheet

hanges NOTE: This is a DIFFERENT COMPANY. Using the trial balance below, complete Step Income Statement and prepare the Statement of Retained Earnings and Red Balance sheet on the pages which follow. To get full credit you must include all me Matteo lo critical subtotals. Jackson Company Adjusted Trial Balance December 31, 2015 DEBIT 1.900 2,460 CREDIT 670 200 20 3,000 150 10,720 1,970 600 670 20 50 1,400 7,600 800 3,160 Cash Accounts Receivable Allowance for Doubtful Accounts Short term Note Receivable Interest Receivable Supplies Inventory Prepaid Expenses Equipment Accumulated Depreciation Copyrights Accounts Payable Interest Payable Unearned Revenue Long Term Note Payable Common Stock Paid-in-Capital In Excess of Par-CS Retained Earnings (1/1/15) Dividends Sales Sales Returns & Allowances Sales Discounts Cost of Goods Sold Bad debt expense Depreciation Expense Amortization Expense Wages Expense Rent Expense Office Expense Supplies Expense Selling Expense Interest Expense Interest Revenue Income Tax Expense Totals 36,800 40 60 22,200 30 770 70 8,000 500 80 800 200 150 760 53,290 53,290 Page 7 of 9

Answer 1

Multi-step income statement:

Jackson Company
Multi Step Income Statement
For the year ended December 31,2015
Sales	36,800
Less: Sales returns & allowances	-40
Sales discounts	-60
Net sales		36,700
Cost of goods sold		-22,200
Gross profit		14,500
Operating expenses:
Bad debt expense	30
Depreciation expense	770
Amortization expense	70
Wages expense	8,000
Rent expense	500
Office expense	80
Supplies expense	100
Selling expense	800
Total operating expenses		10,350
Operating income		4,150
Non-operating income(Expense):
Interest revenue		150
Interest expense		-200
Income Before income tax		4,100
Income tax expense		-760
Net income		3,340

Statement of retained earnings:

Jackson Company
Statement of Retained Earnings
For the year ended December 31,2015
Retained earnings, 1/1/15	3,160
Net income	3,340
Balance	6,500
Less: Dividends	-600
Retained earnings, 12/31/15	5,900

Balance sheet:

Jackson Company
Classified Balance Sheet
December 31,2015
Assets
Current assets:
Cash		1,900
Accounts receivable	2,460
Less: Allowance for Doubtful Accounts	-670	1,790
Short term notes receivable		200
Interest receivable		20
Supplies		30
Inventory		3,000
Prepaid Expenses		150
Property,plant,and equipment:
Equipment	10,720
Accumulated depreciation	-1,970	8,750
Intangible assets:
Copyrights		600
Total assets		16,440
Liabilities and stockholder's equity
Current liabilities:
Accounts payable	670
Interest payable	20
Unearned revenue	50
Total current liabilities		740
Long term notes payable		1,400
Total liabilities		2,140
Stockholder's equity:
Common stock		7,600
Paid-in-Capital In Excess of Par - CS		800
Retained earnings		5,900
Total stockholder's equity		14,300
Total liabilities and stockholder's equity		16,440