Question

Problems Group A 

P4-29A Preparing financial statements including a classified balance sheet in report form, preparing and posting closing entries, and preparing post-closing trial balance 

The adjusted trial balance of Erickson Real Estate Appraisal at June 10, 2018, follows Net Loss 5(9,500) ERICKSON REAL ESTATE APPRAISAL Adjusted Trial Balance June 30, 2018, Balance Account Title Debit Credit Cash 5 4600 Accounts Receivable 5.300 Office Supplies 1.500 Prepaid Insurance 1,700 Land 13.000 Building 82.000 Accumulated Depreciation Building $ 25,200 Accounts Payable 18.700 Interest Payable 8,500 Salaries Payable 2.400 Unearned Revenue 7,600 Notes Payable (long-term) 40,000 Common Stock 3,000 Retained Earnings 39,500 Dividends 27,300 Service Revenue 48, 100 Insurance Expense 4,400 Salaries Expense 33,500 Supplies Expense 300 Interest Expense 8,500 Utilities Expense 2,700 Depreciation Expense-Building 8,200 Total S 193,000 $ 193,000

Requirements 

1. Prepare the company's income statement for the year ended June 30, 2018.

2. Prepare the company's statement of retained earnings for the year ended June 30, 2018.

3. Prepare the company's classified balance sheet in report format June 30, 2018.

4. Journalize the closing entries.

Answer 1

1 $ 48100 ERICKSON REAL ESTATE APPRAISAL Income Statement For the year ended June 30,2018 Revenue : Service Revenue Expense : Insurance Expense 4400 Salaries Expense 33500 Supplies Expense 300 Interest Expense 8500 Utilities Expense 2700 Depreciation Expense - Building 8200 Total Expense $ 57600 Net Loss ($9500) 2. ERICKSON REAL ESTATE APPRAISAL Statement of Retained Earning For the year ended June 30,2018 Beginning balance of Retained Earning Less : Net Loss $ 39500 (9500) 30000 (27300) $ 2700 Less : Dividend Ending balance of Retained Earning

3 ERICKSON REAL ESTATE APPRAISAL Balancesheet For the year ended June 30,2018 Assets Amount ($) Amount ($) Current Asset Cash 4600 Account Receivable 5300 Office Supplies 1500 Prepaid Insurance 1700 Total Current asset 13100 Property, Plant and Equipments Land 13000 Building 82000 Less : Accumulated Depreciation - Building (25200) Property, Plant and Equipments - Net 69800 Total Assets 82900 Liabilities and Stockholders' Equity Current Liabilities Account Payable 18700 Interest Payable 8500 Salaries Payable 2400 Unearned Revenue 7600 Total Current Liabilities 37200 Long term liabilities Notes Payable(long-term) 40000 Stockholders' Equity Common Stock 3000 Retained Earning 2700 Total stockholders' equity 5700 Total liabilities and stockholders' equity 82900

4 Closing entries Date General Journal Jun-30 Service Revenue Income Summary (To close revenue account) Debit ($) Credit ($) 48100 48100 57600 4400 33500 300 Jun-30 Income Summary Insurance Expense Salaries Expense Supplies Expense Interest Expense Utilities Expense Depreciation Expense - Building (To close expense account) 8500 2700 8200 9500 Jun-30 Retained Earning Income Summary (To close income account) 9500

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