Question

Rev 85 6. (28 points) Kent Corporation Adjusted Trial Balance Data December 31, 2020 Accounts Payable $12,000 CA 13 Accounts Receivable 13,000 Accumulated Depreciation Building 6,000 Accumulated Depreciation Equipment 9,000 60,000 Common Stock 24,000 NCAA Copyrights 22.000 Dividends Declared 12.000 Equipment 15,000 25,000 Note Payable (10%, due in 5 years) Office Supplies 1 cod 3.000 Retained Earnings (January 1, 2019) 23.000 Wages Payable 2.000 Lyo Service Revenue 85.000 Wages Expense Utilities Expense 2.000 Depreciation Expense Insurance Expense 2.000 Office Supplies Expense Interest Expense oo Wondes M 80.000 CL 12 123 1.000 Answer the following questions: Hint - use the accounting equation - you do not need to prepare detailed financial statements. A. Current assets are s o C. Current liabilities are $ 19,00 E. Net income iss_43.000 G. Total equity is $7,000 B. Total assets are $ 25,00D D. Total liabilities are $ 5,000 F. Retained earnings is $ 35,

Answer 1

A.

Cash	$24,000
Accounts receivable	$13,000
Office Supplies	$1,000
Prepaid Insurance	$3,000
Total current Assets	$41,000

B.

Total current Assets	$41,000
Land	$25,000
Building	$60,000
Accumulated depreciation-Building	($6,000)
Equipment	$15,000
Accumulated depreciation-Equipment	($9,000)
Copyrights	$22,000
Total Assets	$148,000

C.

Accounts payable	$12,000
Wages payable	$2,000
Current liabilities	$14,000

D.

Current liabilities	$14,000
Notes payable	$40,000
Total liabilities	$54,000

E.

Revenues:
Service revenue		$85,000
Less: Expenses
Wages expense	$28,000
Utilities expense	$2,000
Depreciation expense	$5,000
Insurance Expense	$2,000
Office supplies expense	$1,000
Interest expense	$40,000
Total Expenses		$78,000
Net income		$7,000

F.

Retained Earnings, Beginning	$23,000
Add: Net income	$7,000
(Less): Dividends Declared	($12,000)
Retained Earnings, Ending	$18,000

G.

Common stock	$40,000
Retained Earnings, Ending	$18,000
Total equity	$58,000