Question

Prepare a trial balance at January 31, 2020, in the trial balance columns of the worksheet. Complete the worksheet using the following additional information. 1. Office supplies at January 31 total $900. 2. Insurance coverage expires on October 31, 2020. 3. Annual depreciation on the equipment is $1,500. 4. Interest of $50 has accrued on the note payable. SUNLAND COMPANY Worksheet For the Month Ended January 31, 2020 Adjustments Adjusted Trial Balance Trial Balance Income Statement Balance Sheet Dr. Cr. Account Titles Dr. Dr. Dr. Cash 46908 46908 - Accounts Receivable 24100 24100 Notes Receivable 41000 9-9-3-3- - Inventory PEPPEPPE - Supplies - - - Prepaid Insurance 133 . கர்மலை 9:25 PM

a) Prepare a multiple-step income statement

b) Prepare a owner's equity statement for January (list items that increase owner's equity first)

c) Prepare a classified balance sheet at the end of January (list current assets in order of liquidity)

Answer 1

A)

SUNLAND COMPANY MULTI STEP INCOME STATEMENT FOR THE MONTH ENDED JANUARY 31,2020
Sales revenue	81700
less:Sales return and allowance	(300)
Sales discount	(116)
Net sales revenue		81284
less:Cost of goods sold		(48840)
Gross margin		32444
Less:Operating expense
Salaries and wage expense	7400
Rent expense	1400
Supplies expense	1100
Insurance expense	150
Depreciation expense	125
Total operating expense		(10175)
Income from operations		22269
Other Income /(expense)
Interest expense		(50)
Net income		22219

B)

SUNLAND COMPANY OWNERS EQUITY STATEMENT FOR THE MONTH ENDED JANUARY 31,2020
Owners Capital ,Jan 1	76300
Add:Net income	22219
Total	98519
Less:Owners Drawings	-800
Owners equity Jan 31	97719

C)

SUNLAND COMPANY BALANCE SHEET AS ON JANUARY 31,2020
ASSETS
Cash	46908
Accounts receivable	24100
Notes receivable	41000
Inventory	26586
Supplies	900
Prepaid insurance	1350
Total current asset		140844
Non current asset
Equipment	7350
Less:Accumulated depreciation- equipment	(1725)	5625
Total asset		146469
LIABILITIES AND STOCKHOLDERS EQUITY
Accounts payable	31700
Notes payable	17000
Interest payable	50
Total current liabilities		48750
Owners equity		97719
Total liabilities and owners equity		146469