Question

Heads Up Company was started several years ago by two hockey Instructors. The company's comparative balance sheets and income statement are provided below. along with additional information 2017 2016 Balance Sheet at December 31 Cash Accounts Receivable Equipment Less! Accumulated Depreciation $ 6,000 1.000 5,500 (1,500) $ 4,000 1,750 5,000 (1,250) $ 9,500 -ok $ 11,000 Accounts Payable Wages Payable Long-Term Bank Loan Payable Contributed capital Retained Earnings 500 500 1,500 5,000 3,500 $1,000 750 500 5.000 2,250 ences $ 11,000 $ 9,500 Income Statement for 2017 Lessons Revenue Wages Expense Depreciation Expense Income Tax Expense $ 37,500 35,000 250 1,000 $ 1,250 Net Income Additional notes a. Bought new hockey equipment for cash, $500. b. Borrowed $1.000 cash from the bank during the year c. Accounts Payable includes only purchases of services made on credit for operating purposes. Because there are no liability accounts relating to Income tax, assume that this expense was fully paid in cash.