Question

3. The records of Roadmaster Auto Rentals show the following information as of December 31, 2017, The stockholders received dividends of $52,000 during the year. Prepare a December income statement, a December statement of retained earnings, and a December 31 balance sheet Prepare a heading for each financial statement Write out the entire account name Enter dollar signs, commas, and underlines in the appropriate places Accounts payable Insurance expen Accounts receivable Common sto Airplanes Notes payable Land 36,000 expense..$75,000 22,000 11,000 15,000 39,000 217,000 60,000 etaied earnings, January ..90,00o 20,000 2,000 Advertising expense 24,000 Cash 60,000 Office Furniture 100,000 Maintenance expense 7,000 Revenues 30,000 Notes r Enter the header at the top of each financial statement. Capitalize only the first word of an account name. Use commas but do not use 'cents', $400 rather than $400.00. Use dollar signs and underlines as appropriate for financial statements

Answer 1

Roadmaster Auto rentals
Income statement
for the year ended December 31, 2017
Revenues		$ 2,17,000
Expenses
Insurance expense	$        2,000
Wages expense	$     75,000
Advertising expense	$     22,000
Maintenance expense	$     39,000
Total expenses		$ 1,38,000
Net income		$      79,000

Roadmaster Auto rentals
Statement of retained earnings
for the year ended December 31, 2017
Retained earnings, January 1		$      90,000
Add: Net income	$     79,000
Less: Dividends	$   (52,000)
Retained earnings, December 31		$ 1,17,000

Roadmaster Auto rentals
Balance sheet
As on December 31, 2017
Assets
Cash	$     11,000
Accounts receivables	$     24,000
Airplanes	$ 1,00,000
Land	$     60,000
Investments	$     30,000
Office furniture	$     15,000
Notes receivables	$     20,000
Total Assets		$ 2,60,000
Liabilities
Accounts payable	$     36,000
Notes payable	$     47,000
Total liabilities		$      83,000
Equity
Common stock	$     60,000
Retained earnings	$ 1,17,000
Total Equity		$ 1,77,000
Total Liabilities and equity		$ 2,60,000