Question

EA5.

LO 3.2Cromwell Corporation has the following trial balance account balances, given in no certain order, as of December 31, 2018. Using the information provided, prepare Cromwell’s annual financial statements (omit the Statement of Cash Flows).

Supplies Fees earned Accounts receivable Accounts payable Office furniture Rent expense Retained earnings Cash Electricity expense Common stock Miscellaneous expenses Dividends $ 865 22,850 2,580 1,945 12,685 12,240 3,600 4,695 1,380 10,000 1,450 2,500

Answer 1

	Cromwell Corporation
	Income Statement
	For the Year Ended December 31st,2018
	Fees Earned=(A)		$                 22,850.00
	Expenses
	Rent Expense	$               12,240.00
	Electricity Expense	$                  1,380.00
	Miscellaneous Expenses	$                  1,450.00
	Total Expenses=(B)		$                 15,070.00
	Net Income=(A)-(B)		$                    7,780.00
	Cromwell Corporation
	Statement of Owner's Equity
	For the Year Ended December 31st,2016
		Common Stock	Retained Earnings
	Common Stock	$               10,000.00	$                    3,600.00
	Add: Net Income		$                    7,780.00
	Less: Dividends		$                  -2,500.00
	Ending Balance	$               10,000.00	$                    8,880.00
	Cromwell Corporation
	Balance Sheet
	For the Year Ended December 31st,2016
	Assets
	Current Assets
	Cash	$                  4,695.00
	Accounts Receivable	$                  2,580.00
	Supplies	$                     865.00
	Total Current Assets		$                    8,140.00
	Property,Plant and Equipment
	Office Furniture		$                 12,685.00
	Total Assets		$                 20,825.00
	Liabilities & Stockholder's equity
	Liabilities
	Accounts Payable		$                    1,945.00
	Owner's Equity
	Common Stock	$               10,000.00
	Retained Earnings	$                  8,880.00
	Total Equity		$                 18,880.00
	Total Liabilities & Stockholder's Equity		$                 20,825.00