Question

The adjusted trial balance for Tybalt Construction as of December 31, 2019, follows. Credit $ 25,000 SYBAL CONSTRUCTION Adjusted Trial Balance December 31, 2019 No. Account Title Debit 101 Cash $ 5,000 104 Short-term investments 2 3,500 126 Supplies 9.100 128 Prepaid insurance 7,800 167 Equipment 50,000 16 Accumulated depreciation Equipment 173 Duilding 156,000 124 Accumulated depreciation _ Blding 193 Land 73,760 201 Accounta payable 203 Interest payable 208 Rent payable 210 Wagen payable 213 Property taxes payable Unearned professional 52,000 17,500 2,800 3,400 2,600 1,400 7,900 23 fees 7,000 63.000 5,000 126,400 99,000 15.500 2,200 2,300 2 Current portion of long ** ter note payable 251 Long-term notes payable 307 Common stock 318 Retained earnings 319 Dividends 12,900 401 Professional fees carned 406 Rent earned 407 Dividends earned 409 Interest earned Depreciation expense 11,440 Building Depreciation expense 7,500 -Equipment 623 Waged expense 26.000 633 Interest expense 4,300 637 Insurance expense 9,900 640 Rent expense 10,400 652 Supplies expense 5,500 692 Postage expense 2.900 683 Property taxes expense 3,200 684 Repair expense 8,100 588 Telephone expense 2,400 690 Utilities expense Totals $433,000 3,300 $433,000 O.Tybat invested $5,000 cash in the business in exchange for common stock during year 2019. The December 31, 2018, credit balance of the Retained Earnings account was $126,400. Required: 1a. Prepare the income statement for the calendar-year 2019. 1b. Prepare the statement of retained earnings for the calendar-vear 2019. 1c. Prepare the classified balance sheet at December 31, 2019 2. Prepare the necessary closing entries at December 31, 2019. Complete this question by entering your answers in the tabs below.

Answer 1

1a. Preparing Income Statement:-

TYBALT CONSTRUCTION

Income Statement

For the Year Ended December 31,2019

Accounts	Amount	Amount
Revenues:-
Professional Fees Earned	$99,000
Rent Earned	15,500
Dividends Earned	2,200
Interest Earned	2,300
Total Revenues		$119,000
Less:- Expenses
Depreciation Expense, Building	$11,440
Depreciation Expense, Equipment	7,500
Wages Expense	26,000
Interest Expense	4,300
Insurance Expense	9,900
Rent Expense	10,400
Supplies Expense	5,500
Postage Expense	2,900
Property Taxes Expense	3,200
Repairs Expense	8,100
Telephone Expense	2,400
Utilities Expense	3,300
Total Expenses		$(94,940)
Net Income		$24,060

1b. Preparing Statement of Retained Earnings:-

TYBALT CONSTRUCTION

Statement of Retained Earnings

For the Year Ended December 31,2019

Accounts	Amount
Retained Earnings	$126,400
Add:- Net Income	24,060
	$150,460
Less:- Dividends	(12,900)
Retained Earnings, Ending	$137,560

1c. Preparing Balance Sheet:-

TYBALT CONSTRUCTION

Balance Sheet

December 31,2019

Accounts	Amount	Amount
Assets:-
Current Assets:-
Cash	$5,000
Short-term Investments	23,500
Supplies	9,100
Prepaid Insurance	7,800
Total Current Assets		$45,400
Property, Plant and Equipment:-
Land	$73,760
Equipment	50,000
Less:- Accumulated Depreciation, Equipment	(25,000)
Building	156,000
Less:- Accumulated Depreciation, Building	(52,000)
Total Property, Plant and Equipment		$202,760
Total Assets		$248,160
Liabilities and Stockholders Equity:-
Current Liabilities:-
Accounts Payable	$17,500
Interest Payable	2,800
Rent Payable	3,400
Wages Payable	2,600
Property Taxes Payable	1,400
Unearned Professional Fees	7,900
Current portion of Long-term Note Payable	7,000
Total Current Liabilities		$42,600
Long-term Liabilities:-
Long-term Notes Payable	$63,000
Total Long-term Liabilities		$63,000
Stockholders Equity:-
Common Stock	$5,000
Retained Earnings, Ending	137,560
Total Stockholders Equity		$142,560
Total Liabilities and Stockholders Equity		$248,160

2. Preparing Closing Entries:-

TYBALT CONSTRUCTION

General Journal (Closing Entries)

December 31, 2019

Date	Accounts Title and Explanation	Debit	Credit
December 31	Professional Fees Earned	$99,000
	Rent Earned	$15,500
	Dividends Earned	$2,200
	Interest Earned	$2,300
	Income Summary		$119,000
	(To Close Revenue Accounts)
December 31	Income Summary	$94,940
	Depreciation Expense, Building		$11,440
	Depreciation Expense, Equipment		$7,500
	Wages Expense		$26,000
	Interest Expense		$4,300
	Insurance Expense		$9,900
	Rent Expense		$10,400
	Supplies Expense		$5,500
	Postage Expense		$2,900
	Property Taxes Expense		$3,200
	Repairs Expense		$8,100
	Telephone Expense		$2,400
	Utilities Expense		$3,300
	(To Close Expenses Accounts)
December 31	Income Summary	$24,060
	Retained Earnings		$24,060
	(To close Income Summary)
December 31	Retained Earnings	$12,900
	Dividends		$12,900
	(To close Dividends Account)