Question

PROBLEM NO. 4 – FINANCIAL STATEMENTS

The adjusted trial balance of Perez Company appears below. Using the information from the adjusted trial balance, you are to prepare for the quarter ending March 31, 2020:

         1.   an income statement.

         2.   an owner’s equity statement.

         3.   a balance sheet.

Perez Company

Adjusted Trial Balance

March 31, 2020

                                                                                                                          Debit             Credit   

Cash.........................................................................................................      $ 17,000

Accounts Receivable..................................................................................        4,500

Supplies....................................................................................................         1,000

Equipment.................................................................................................         18,000

Accumulated Depreciation—Equipment........................................................                                 $   6,000

Accounts Payable....................................................................................... 8,000

Unearned Service Revenue.........................................................................                                      7,000

Salaries and Wages Payable.......................................................................                                      1,000

Perez, Capital............................................................................................ 18,250

Perez, Drawings.........................................................................................           3,500

Service Revenue........................................................................................ 16,400

Salaries and wages expense.......................................................................         6,000

Supplies Expense.......................................................................................          2,500

Rent Expense............................................................................................           2,100

Depreciation Expense.................................................................................          750

Advertising expense....................................................................................          700

Utilities Expense.........................................................................................          600                     

                                                                                                                        $56,650                $56,650

Answer 1

1.

Perez Company
Income Statement
For the year ended March 31, 2020
Revenues
Service revenue		$   16,400
Less: Expenses
Salaries and wages expense	$   6,000
Supplies expense	$   2,500
Rent expense	$   2,100
Depreciation expense	$      750
Advertising expense	$      700
Utilities expense	$      600
Total expenses		$   12,650
Net income		$     3,750

2.

Perez Company
Statement of Change in Equity
For the year ended March 31, 2020
Perez capital, Beginning	$   18,250
Add: net income	$     3,750
Less: Drawings	$   (3,500)
Perez capital, Ending	$   18,500

3.

Perez Company
Balance Sheet
As at December 31, 2020
Assets
Current assets
Cash	$   17,000
Accounts receivable	$     4,500
Supplies	$     1,000
Current assets		$   22,500
Property, Plant and Equipment
Equipment	$   18,000
Less: Accumulated depreciation, Equipment	$   (6,000)	$   12,000
Total assets		$   34,500
Liabilities and owners equity
Current liabilities
Accounts payable	$     8,000
Unearned service revenue	$     7,000
Salaries and wages payable	$     1,000
Total current liabilities		$   16,000
Owners Equity		$   18,500
Total liabilities and owners equity		$   34,500

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