Question

The completed worksheet for Cantu Corporation as of December 31, 2019, after the company had completed the first month of operation, appears below. Income Statement Debit Credit CANTU CORPORATION Worksheet Month Ended December 31, 2019 Adjusted Trial Trial Balance Adjustments Balance Debit Credit Debit Credit Debit Credit 76,300 76,300 11,199 11, 100 8,300 5,109 3,200 9,000 1,500 7,500 107,500 107,500 2,150 11,180 11,100 107,180 107,100 6,300 6,300 117,100 117,109 5,100 5,180 1,500 1,500 2,150 2,150 15,900 15,900 980 900 235,300 235,300 8,750 8,750 237,450 237,450 Account Name Cash Accounts Receivable Supplies Prepaid Advertising Equipment Accumulated Depreciation Equipment Accounts Payable Selena Cantu, Capital Selena Cantu, Drawing Fees Income Supplies Expense Advertising Expense Depreciation Expense-Equipment Salaries Expense Utilities Expense Totals Net Income Balance Sheet Debit Credit 76,389 11,180 3,209 7,500 107,500 2,15e 11,100 107,109 6,300 2,15e 117, 100 5, 100 1,500 2,150 15,909 900 25,550 91,550 117,100 117, 109 211,900 120, 35e 91,550 211,900 117,109 211,900 Required: 1. Prepare an income statement. 2. Prepare a statement of owner's equity. The owner made no additional investments during the month. 3. Prepare a balance sheet.

Answer 1

Requirement 1:

CANTU CORPORATION
Income Statement
Month Ended December 31,2019
Revenues:
Fees Income		117,100
Total Revenues		117,100
Expenses:
Supplies expense	5,100
Advertising expense	1,500
Depreciation expense-Equipment	2,150
Salaries expense	15,900
Utilities expense	900
Total Expenses		25,550
Net income		91,550

Requirement 2:

CANTU CORPORATION
Statement of Owner's Equity
Month Ended December 31,2019
Selene Cantu, Capital, 1/1/19		107,100
Net income	91,550
Selana Cantu, Drawing	-6,300
Total increase in Owner's capital		85,250
Selene Cantu, Capital,12/31/19		192,350

Requirement 3:

CANTU CORPORATION
Balance Sheet
Month Ended December 31,2019
Assets
Cash		76,300
Accounts receivable		11,100
Supplies		3,200
Prepaid Advertising		7,500
Equipment	107,500
Accumulated depreciation-Equipment	-2,150	105,350
Total Assets		203,450
Liabilities and Owner's equity
Accounts payable		11,100
Total liabilities		11,100
Owner's Equity
Selene Cantu, Capital		$192,350
Total Owner's equity		$192,350
Total liabilities and Owner's equity		$203,450

Analyze:

Net income if Advertising expense is 3,000 instead of 1,500 = Net income with 1,500 of advertising expense - 1,500

= 91,550 - 1,500

=90,050