Question

On June 1, 2017, Sunland Company was started with an initial investment in the company of $22,470 cash. Here are the assets, liabilities, and common stock of the company at June 30, 2017, the revenues and expenses for the month of June, its first month of operations: Cash Accounts receivable Service revenue Supplies Advertising expense Equipment Common stock $ 4,770 4,110 7,670 2,310 400 26,170 22,470 Notes payable Accounts payable Supplies expense Maintenance and repairs expense Utilities expense Salaries and wages expense $12,340 610 1,090 690 210 1,570

Answer 1

	RETAINED EARNINGS STATEMENT
	OPENING RETAINED EARNINGS	-
add	net income(WN1)		3,710.00
less	dividends(balancing figure)	-                        1,770.00
	closing retained earnings	1,940.00
	(WN 2)
WN 1:-
calculation of net income
	Service Revenue	7,670.00
less
	advertising expense	400.00
	supplies expense	1,090.00
	maintenance	690.00
	utilities	210.00
	salaries & wages	1,570.00
	Net income	3,710.00
WN 2:-
balance sheet as on 30/06/2017
	liabilties		assets
	common stock	22,470.00	accounts receivable	4,110.00
	notes payable	12,340.00	cash	4,770.00
	accounts payable	610.00	supplies	2,310.00
			equipment	26,170.00
	retained earnings	1,940.00
	(balancing figure)
	total	37,360.00	total	37,360.00