Question

Stacey's Piano Rebuilding Company has been operating for one year (2010). At the start of 2011, its income statement accounts had zero balances and its balance sheet account balances were as follows: Cash Accounts receivable Supplies Equipment Land Building $ 6,500 Accounts payable 30,500 Unearned fee revenue (deposits) 1,480 Note payable long-term) 9,900 Contributed capital 7.600 Retained earnings 26,800 $ 8.900 3.840 47,600 7.900 14,540 a. Rebuilt and delivered five pianos in January to customers who paid $18.800 in cash. b. Received a $560 deposit from a customer who wanted her piano rebuilt. c. Rented a part of the building to a bicycle repair shop, received $910 for rent in January. d. Received $7.500 from customers as payment on their accounts. e. Received an electric and gas utility bill for $480 to be paid in February. f Ordered $870 in supplies. 9. Paid $1,440 on account in January. h. Received from the home of Stacey Eddy, the major shareholder, a $930 tool (equipment) to use in the business. i Paid $14.800 in wages to employees who worked in January. ; Declared and paid a $2,100 dividend. k. Received and paid cash for the supplies in (1).

Answer 1

1	Revenue	-	Expenses	=	Net Income
	$19,710	-	$15,280	=	$4,430
2	Assets	=	Liabilities	+	Stockholder's Equity
	$85,640	=	$59,940	+	$25,700
	Working
	Income Statement (unadjusted)
	Operating revenues:
	Rebuilding fees revenue		$18,800
	Operating expenses:
	Wages expense		$14,800
	Utilities expense		$480
	Operating income		$3,520
	Other items:
	Rent revenue		$910
	Net Income		$4,430
3	Revenue	-	Expenses	=	Net Income
	$20,270	-	$14,800	=	$5,470