Question

Exercise 3-20A Record transactions and prepare adjusting entries, adjusted trial balance, financial statements, and closing entries (LO3-3, 3-4, 3-5, 3-6, 3-7) (GL) On January 1, 2021, Red Flash Photography had the following balances: Cash, $13,000; Supplies, $8,100; Land, $61,000; Deferred Revenue, $5,100: Common Stock $51,000; and Retained Earnings, $26,000. During 2021, the company had the following transactions: 1. February 15 Issue additional shares of common stock, $21,000. 2. May 20 Provide services to customers for cash, $36,000, and on account, $31,000. 3. August 31 Pay salaries to employees for work in 2021, $24,000. 4. October 1Purchase rental space for one year, $13,000. 5. November 17 Purchase supplies on account, $23,000. 6. December 30 Pay dividends, $2,100. The following information is available on December 31, 2021: 1. Employees are owed an additional $4,100 in salaries. 2. Three months of the rental space has expired. 3. Supplies of $5,100 remain on hand. 4. All of the services associated with the beginning deferred revenue have been performed. Requirement General Journal General Ledger Trial Balance Income Statement Statement of SE Balance Sheet < Prev 11 of 11 !!! Next >

Answer 1

1) Income statement

For the year ended December 31,2021

Revenue
Service revenue (		72100
Total revenue		72100
Expense
Salaries expense	28100
Rent expense	3250
Supplies expense	17900
Total expense		49250
Net income (loss)		22850

Statement of Stockholder's equity

	Common stock	Retained earnings	Total stockholder's equity
Beginning balances	51000	26000	77000
Issue common Stock	21000		21000
Net income		22850	22850
Dividend		-2100	-2100
Ending balance	72000	46750	118750