Question

Required Information [The following information applies to the questions displayed below.) Ricky's Plano Rebuilding Company has been operating for one year. On January 1, at the start of its 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 $ 6,300 Accounts Payable 31,898 Deferred Revenue (deposits) 2,550 Notes Payable (long-term) 12,380 Common Stock 9,150 Retained Earnings 26, Bee $ 8,850 4.450 49, eee 12,5ee 12,500 Following are the January transactions: a. Received a $760 deposit from a customer who wanted her plano rebuilt in February b. Rented a part of the building to a bicycle repair shop; $785 rent received for January c. Delivered five rebuilt planos to customers who paid $21,475 In cash. d. Delivered two rebuilt planos to customers for $10,500 charged on account. e. Received $8,100 from customers as payment on their accounts. f. Received an electric and gas utility bill for $600 for January services to be paid in February g. Ordered $1,120 In supplies. h. Pald $2,250 on account in January. 1. Pald $15,900 in wages to employees in January for work done this month. J. Received and paid cash for the supplies in (9). 5-a. Prepare an Income statement for the month ended and at January 31. 5.b. Prepare a statement of retained earnings for the month ended and at January 31. 5.c. Prepare a classified balance sheet for the month ended and at January 31.

Answer 1

Ricky's Piano Rebuilding Company
Date	General,Journal	Debit	Credit
a)	Cash	$                             760.00
	To Deferred Revenue		$                                     760.00
	(Being amount received as advance from customers)
b)	Cash	$                             785.00
	To Rent Revenue		$                                     785.00
	(Being amount of Rent Revenue received for January)
c)	Cash	$                       21,475.00
	To Rebuilding Fees Revenue		$                               21,475.00
	(Being amount of five rebuild piano's to customers and received cash)
d)	Accounts receivable	$                       10,500.00
	To Rebuilding Fees Revenue		$                               10,500.00
	(Being amount of Two rebuild Piano's to Customers' on account)
e)	Cash	$                         8,100.00
	To Accounts Receivable		$                                 8,100.00
	(Being amount of cash received from customer's)
f)	Utilities Expenses	$                             600.00
	To Accounts Payable		$                                     600.00
	(Being amount of Utilties bills received )
g)	No Entry required	$                       11,000.00
			$                               11,000.00
h)	Accounts Payable	$                         2,250.00
	To Cash		$                                 2,250.00
	(Being amount on account payment)
i)	Salaries and Wages	$                       15,900.00
	To Cash		$                               15,900.00
	(Being amount paid to Employees)
j)	Supplies	$                         1,120.00
	To Cash		$                                 1,120.00
	(Being amount of Supplies received and cash paid)
5a)
Ricky's Piano Rebuilding Company
Income Statement
January31st
Operating Revenue
Rebuilding Fees Revenue($21475+$10500)		$                       31,975.00
Operating Expenses
Salaries and Wages Expense	$                                                                                                                          15,900.00
Utilities Expense	$                                                                                                                                600.00
Total Operating Expenses		$                       16,500.00
Operating Income		$                       15,475.00
Other Items
Rent Revenue		$                             785.00
Net Income		$                       16,260.00
5b)
Ricky's Piano Rebuilding Company
Statement of Stockholder's equity
	Common Stock	Retained Earnings	Total Stockholder's equity
Beginning Balance	$                                                                                                                          12,500.00	$                       12,500.00	$                               25,000.00
Net Income		$                       16,260.00	$                               16,260.00
Balance	$                                                                                                                          12,500.00	$                       28,760.00	$                               41,260.00
5c )	Ricky's Piano Rebuilding Company
	Balance Sheet as at January 31st
Assets
Current Assets
Cash($6300+$760+$785+$21475+$8100-$2250-$15900-$1120)	$                                                                                                                          18,150.00
Accounts Receivable($31000+$10500-$8100)	$                                                                                                                          33,400.00
Supplies	$                                                                                                                            3,670.00
Total Current Assets		$                       55,220.00
Fixed Assets
Equipment	$                                                                                                                          12,300.00
Land	$                                                                                                                            9,150.00
Building	$                                                                                                                          26,000.00
Total Fixed Assets		$                       47,450.00
Total Assets		$                   1,02,670.00
Liabilities
Current Liabilities
Accounts Payable($8850+$600-$2250)	$                                                                                                                            7,200.00
Deferred Revenue(Deposits)=($4450+$760)	$                                                                                                                            5,210.00
Total Current Liabilities		$                       12,410.00
Notes Payable(Long Term)		$                       49,000.00
Stockholder's Equity
Common Stock	$                                                                                                                          12,500.00
Retained Earnings	$                                                                                                                          28,760.00
Total Stockholder's equity		$                       41,260.00
Total Liabilities and Stockholder's Equity		$                   1,02,670.00