Question

Required information [The following information applies to the questions displayed below.) Stacey's Piano Rebuilding Company has been operating for one year. At the start of the second year, its income statement accounts had zero balances and its balance sheet account balances were as follows: Cash Accounts receivable Supplies Equipment Land Building $ 6,400 Accounts payable 32,000 Unearned revenue 1,500 Long-term note payable 9,500 Common stock 7,400 Additional paid-in capital 25,300 Retained earnings $ 9,600 3,840 48,500 1,600 7,000 11,560 a. Rebuilt and delivered five pianos in January to customers who paid $19,000 in cash. b. Received a $600 deposit from a customer who wanted her piano rebuilt. C. Rented a part of the building to a bicycle repair shop; received $850 for rent in January. d. Received $7,200 from customers as payment on their accounts. e. Received an electric and gas utility bill for $400 to be paid in February. f. Ordered $960 in supplies. g. Paid $2,300 on account in January. h. Received from the home of Stacey Eddy, the major shareholder, a $920 tool (equipment to use in the business in exchange for 100 shares of $1 par value stock. i. Paid $16,500 in wages to employees who worked in January. j. Declared and paid a $2,200 dividend (reduce Retained Earnings and Cash). k. Received and paid cash for the supplies in (f).

Answer 1

Cash
Beg. bal.	6,400	2,300	g.
a.	19,000	16,500	i.
b.	600	2,200	j.
c.	850	960	k.
d.	7,200
End. bal.	12,090
Accounts Receivable
Beg. bal.	32,000	7,200	d.
End. bal.	24,800
Supplies
Beg. bal.	1,500
k.	960
End. bal.	2,460
Equipment
Beg. bal.	9,500
h.	920
End. bal.	10,420
Land
Beg. bal.	7,400
End. bal.	7,400
Buildings
Beg. bal.	25,300
End. bal.	25,300
Accounts Payable
Beg.bal.		9,600
		400	e.
g.	2,300
End. bal.		7,700
Unearned Revenue
Beg. bal.		3,840
		600	b.
End. bal.		4,440
Long Term Note Payable
Beg. bal.		48,500
End. bal.		48,500
Common Stock
Beg. bal.		1,600
		100	h.
End. bal.		1,700
Additional Paid-in Capital
Beg. bal.		7,000
		820	h.
End. bal.		7,820
Retained Earnings
Beg. bal.		11,560
Rebuilding Fee Revenue
Beg. bal.		0
		19,000	a.
End. bal.		19,000
Rent Revenue
Beg. bal.		0
		850	c.
End. bal.		850
Wages Expense
Beg. bal.	0
i.	16,500
End. bal.	16,500
Utilities Expense
Beg. bal.	0
e.	400
End. bal.	400

Assets $ 82,470

=

Liabilities $ 60,640

+

Stockholders Equity $ 21,830

4.

Net Income

$ 7,890