Question

	May's Retail Stores
	Work Sheet
	For Year Ended December 31, 2019
		Unadjusted						Adjusted
101	Cash	215,000						215,000
126	Marketable Securities	43,000						43,000
127	Inventory	41,000				(a)	13,000	28,000
131	Accounts Receivables	29,000		(b)	4,300			33,300
167	Building	500,000						500,000
168	Accumulated depreciation - Building		95,000			(c)	20,000		115,000
176	Land	70,000						70,000
186	Trademarks	15,000						15,000
201	Accounts payable		65,000			(d)	34,300		99,300
203	Interest payable		37,000						37,000
210	Wages payable					(e)	31,000		31,000
251	Long-term notes payable		136,000						136,000
301	Common Stock		200,000						200,000
305	Retained Earnings		336,000						336,000
401	Sales		760,000			(b)	4,300		764,300
501	Cost of Goods Sold	350,000		(a)	13,000			363,000
612	Depreciation expense			(c)	20,000			20,000
633	Advertising expenses	21,000		(d)	5,000			26,000
637	Insurance expense			(d)	4,300			4,300
640	Rent expense	21,000		(d)	1,000			22,000
652	Supplies expense			(d)	3,000			3,000
683	Wages expense	230,000		(e)	31,000			261,000
684	Interest expense	50,000						50,000
686	Repairs expense	32,000						32,000
690	Utilities expense	12,000		(d)	21,000			33,000
No.	Account Title	Trial Balance			Adjustments			Trial Balance
		DR	CR		DR		CR	DR	CR
	Totals	1,330,000	1,629,000		102,600		89,600	1,432,600	1,718,600
Requirements:
1) Complete adjusted trial balance of worksheet
2) Use your completed worksheet to prepare (a) Income statement, (b) Statement of Owner's Equity and (c) balance sheet as of December 31, 2019.

Answer 1

2. a.

May's Retail Stores Income Statement For the year ended December 31, 2019
Sales		$ 764,300
Cost of Goods Sold		363,000
Gross Profit		401,300
Operating Expenses
Advertising Expense	$ 26,000
Wages Expense	261,000
Rent Expense	22,000
Insurance Expense	4,300
Supplies Expense	3,000
Utilities Expense	33,000
Repairs Expense	32,000
Depreciation Expense	20,000
Interest Expense	50,000	451,300
Net Income ( loss )		$ ( 50,000)

b.

May's Retail Store Statement of Owners Equity For the year ended December 31, 2019
Common Stock	$ 200,000
Retained Earnings, January 1	336,000
Owner's Equity, January 1		$ 536,000
Add: Net Income ( loss ) for the period		(50,000)
Owner's Equity, December 31		$ 486,000

c.

May's Retail Store Balance Sheet December 31, 2019
Assets			Liabilities
Current Assets			Current Liabilities
Cash	$ 215,000		Accounts Payable	$ 99,300
Marketable Securities	43,000		Wages Payable	31,000
Accounts Receivable	33,300		Interest Payable	37,000
Inventory	28,000		Total Current Liabilities		$167,300
Total Current Assets		$ 319,300	Long Term Liabilities
Property Plant and Equipment			Long-term Notes Payable		136,000
Land	70,000		Total Liabilities		303,300
Buildings, net	385,000	455,000	Owners Equity
Intangible Assets			Common Stock	200,000
Trademarks		15,000	Retained Earnings	286,000
			Total Owners Equity		486,000
Total Assets		789,300	Total Liabilities and Owners Equity		789,300