Question

Napa Tours Co. is a travel agency. The nine transactions recorded by Napa Tours during April 2018, its first month of operations, are indicated in the following T accounts:a

Cash Equipment Dividends (1) 25,000(2) 1,750 (7) 10,000 (3) 3,250 (4) 2,750 (6) 7,500 (9) 2,500 (3) 18,000 (9) 2,500 Accounts Receivable Accounts Payable Service Revenue (5) 13,500(7) 10,000 (6) 7,500(3) 14,750 (5) 13,500 Supplies Common Stock Operating Expenses (2) 1,750 (8) 1,000 (4) 2,750 (8) 1,000 (1) 25,000

a. Prepare an unadjusted trial balance. List all the accounts in the order of Assets, Liabilities, Stockholders’ equity, Revenues, and Expenses. Place the amounts in the proper columns. If an entry is not required in an amount box, leave it blank.

b. Based upon the unadjusted trial balance, determine the net income or net loss.

Answer 1

Unadjsuted Trial Balane
	Debit Balance	Credit Balance
Cash	$               17,250
Equipment	$               18,000
Dividends	$                 2,500
Account Receivable	$                 3,500
Account payable		$                        7,250
Service Revenue		$                      13,500
Supplies	$                     750
Common Stock		$                      25,000
Operating Expenses	$                 3,750
	$               45,750	$                      45,750
Answer = B)
CALCULATION OF THE NET INCOME
Service Revenue	$               13,500
Less: Expenses
Operating Expenses	$                 3,750
Net income	$                 9,750
Amswer =	$                 9,750