Question

Part 3 Required: A. Prepare an Income Statement in good form. B. Calculate the new Retained Earnings balance. C. Prepare a Balance Sheet as of February 28th in good form.

Answer 1

Part 2

Adjusting entries Date Particulars Feb-28 Insurance (7800/36 Prepaid Insurance (Insurance expired) (in ) Debit 217 in S) Credit 217 4,750 Feb-28 Unearned Revenue Tutoring Service Revenue (Unearned service now due) 4,750 11,600 Feb-28 Wages expense Wages Payable (Salaries accrued as on the end of the month) 11,600 7,600 Feb-28 Supplies expenses Supplies (Supplies consumed during the month) 7,600 625 Feb-28 Depreciation expense Accumulated Depreciation (Depreciation entry passed) 625 1,250 Feb-28 Interest expense Interest Payable (Accrued Interest) 1.250
Part 3

Worksheet Trial Balance Debit Credit Account Title Adjustments Debit Credit (in S) Adjusted Trial Balance Debit Credit 40,820 6,840 9,100 7,800 68,000 1,50,000 7,600 217 40,820 6,840 1,500 7,583 68,000 1,50,000 e 625 625 1,450 c f 11,600 1.250 6 4,750 Cash Accounts Receivable Supplies Prepaid Insurance Land Building Accumulated Depreciation Accounts Payable Wage Payable Interest Payable Unearned Revenue Note Payable Common Stock Retained Earnings Dividends Tutoring Service Revenue Wage expense Utility expense Insurance expense Supply expenses Depreciation expense Interest expense 1,450 11,600 1,250 5,750 1,25,000 1,00,000 27,400 I 10,500 1,25,000 1,00,000 27,400 T | 2.000 2,000 35,840 b 4,750 40,590 ст 11,600 12,300 3,330 a d 217 7,600 625 1,250 23,900 3,330 217 7,600 625 1.250 Total 3,00,190 3,00,190 26,042 26,042 3,13,665 3,13,665

Income Statement (Single-Step) For the month ended Feb 28, 2020 in S in S 40,590 40,590 Particulars Tutoring Service Revenue Total Revenue (-) Expenses Wage expense Utility expense Insurance expense Supply expenses Depreciation expense Interest expense Total Expenses 23,900 3,330 217 7,600 625 1,250 36,922 Net Profit 3,668 Statement of Retained Earnings For the month ended Feb 28, 2020 in S Particulars Beginning Balance (+) Net Profit for the year Dividend declared Ending Balance in S 27,400 3,668 -2,000 29,068

Balance Sheet as at Feb 28, 2020 Particulars Assets Current Assets Cash Accounts Receivable Supplies Prepaid Insurance Total Current Assets Long-Term Assets Land Building Accumulated Depreciation Total Long-Term Assets 40,820 6,840 1,500 7,583 56,743 68,000 1,50,000 -625 2,17,375 Total Assets 2,74,118 Liabilities Accounts Payable Wage Payable Interest Payable Unearned Revenue Note Payable Total Liabilities 1,450 11,600 1,250 5,750 1,25,000 1,45,050 Stockholder's equity Common Stock Retained Earnings Total Stockholder's equity 1,00,000 29,068 1,29,068 Total Liabilities and Owners Equity 2,74,118