Question

E4.6 (L01, 2, 3), AP Franken Company, a ski tuning and repair shop, opened on November 1, 2021. The company carefully kept track of all its cash receipts and cash payments. The following information is available at the end of the ski season, April 30, 2022. Cash Cash Receipts Payments Issuance of common shares $20,000 Payment to purchase repair shop equipment $ 9,200 Rent payments to landlord 1,050 Newspaper advertising payment 375 Utility bill payments 970 Part-time helper's wage payments 2,600 Income tax payment 10,000 Cash receipts from ski and snowboard repair services 32,150 Subtotals 52,150 24,195 Cash balance 27,955 Totals $ 52,150 $52,150 The repair shop equipment was purchased on November 1 and has an estimated useful life of 4 years. Lease payments to the landlord are made at the beginning of each month. The part-time helper is owed

Answer 1

Franken Company Income statement For the six month ended April 30,2022 Revenues=32150+540 32690 service revenue expenses: Depreciation expenses (9200/4)*6/12 1150 advertising expenses 375 utilities expenses 970 salaries & wages expenses=2600+420 3020 Income tax expenses 10000 rent expenses 1050 Total expenses 16565 net income/(loss) 16125 27955 540 28495 Franken Company Balance sheet April 30, 2022 Current assets cash accounts receivable Total current assets property, plant & equipments Equipment Less: Accumualted Depreciation Total assets liabilities & stockholder equity current liabilities salaries & wages payable stockholder equity common stock retained earning Total stockholder equity total liabilities & stockholder equity 9200 11508050 36545 420 20000 16125 36125 36545