Question

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Instructions McDonald Marina provides docking and cleaning services for pleasure boats at its marina in southern Florida. The following accou balances are available: $ 237,000 Accounts payable S 26,600 Interest expense 268,700 Interest payable Accounts receivable 19,000 Accumulated depreciation (building) 64,800 Land 876,000 Accumulated depreciation (equipment) Rent expense 950,200 14,500 Bonds payable (due 2024) Rent payable 2,000,000 2,500 Retained earnings, 12/31/2018 Building 197,200 138,500 Service revenue (cleaning) Cash 22,500 472,500 Common stock (40,000 shares) Service revenue (docking) 600,000 1,480,000 Depreciation expense (building) 21,800 Supplies 9,900 Depreciation expense (equipment) 248,100 Supplies expense 89,300 Utilities expense Dividends 25,400 239,600 2,500,000 Equipment Wages expense 986,400 Income taxces expense 21,500 Wages payable 21,600 Required: 1. Prepare a single-step income statement, a retained eamings statement, and a classified balance sheet for the year ended December 31, 2019. 2. Conceptual Connection: How would a multiple-step income statement be different from the single-step income statement you prepared for McDonald Marina?

Answer 1

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McDonald Marina
Income Statement for the year ended December 31, 2019.
Particulars	Amount $	Amount $
Revenues
Service Revenue (docking)	1,460,000.00
Service Revenue (cleaning)	472,500.00
Net Sales		1,932,500.00
Expenses
Wages expense	986,400.00
Depreciation expense- equipment	246,100.00
Utilities Expense	239,600.00
Interest Expense	237,000.00
Supplies expense	89,300.00
Depreciation expense- building	21,600.00
Rent expense	14,500.00
Total Expense		1,834,500.00
Income before tax		98,000.00
Income Tax expense		21,500.00
Net Income		76,500.00
Statement of Retained Earnings for the year ended December 31, 2020.	Amount $
Opening Balance	138,500.00
Add: Net Income for the year	76,500.00
Less: Dividend	25,400.00
Closing Balance	189,600.00

Balance Sheet as at December 31, 2019.
Assets	Amount $	Amount $
Cash		22,500.00
Accounts Receivable		268,700.00
Supplies		9,900.00
Total Current Assets		301,100.00
Land		876,000.00
Equipment	2,500,000.00
Accumulated Depreciation- Equipment	(950,200.00)	1,549,800.00
Building	197,200.00
Accumulated Depreciation- Building	(64,800.00)	132,400.00
Total Non Current Assets		2,558,200.00
Total Assets		2,859,300.00
Liabilities
Accounts Payable	26,600.00
Interest Payable	19,000.00
Rent Payable	2,500.00
Wages Payable	21,600.00
Current Liabilities		69,700.00
Bond Payable	2,000,000.00
Long Term Liabilities		2,000,000.00
Total Liabilities		2,069,700.00
Stockholders' Equity
Common Stock	600,000.00
Retained Earnings	189,600.00
Total Stockholders' Equity		789,600.00
Total Liabilities & Stockholders' Equity		2,859,300.00