Question

The adjusted trial balance for Rowdy Profits Corporation reports that its equipment had cost $270,000. For the current year, the company has recorded $32,400 of depreciation, which brings the total depreciation to date to $162,000. Balance Sheet Assets Liabilities Stockholders' Equity Income Statement Revenues Expenses Required: Using the headings shown above, indicate the location and amounts that would be used to report the three items on the company's balance sheet and income statement

Answer 1

Balance Sheet
Assets
Equipment = $270000
Accumulated Depreciation = ($162000)

Income Statement
Expense
Depreciation Expense = $32400

Date	Account Titles	Debit	Credit
1-Jan	Prepaid Insurance	$          6,000
	Cash		$          6,000
2	Prepaid Rent	$          4,800
	Cash		$          4,800
3	Cash	$        30,000
	Notes Payable		$        30,000
4	Delivery Van	$        28,800
	Cash		$        28,800
5	Cash	$          4,000
	Common Stock		$          4,000
6	Supplies	$          1,400
	Accounts Payable		$          1,400
7	Cash	$             700
	Accounts Receivable		$             700
8	Accounts Payable	$             300
	Cash		$             300
9	Accounts Receivable	$        10,600
	Service Revenue		$        10,600
10	Cash	$          7,400
	Service Revenue		$          7,400
16	Salaries Expense	$          2,960
	Cash		$          2,960
20	Cash	$          3,700
	Unearned Service Revenue		$          3,700
25	Cash	$          3,500
	Accounts Receivable		$          3,500
31a.	Utilities Expense	$          1,100
	Accounts Payable		$          1,100
31b.	Supplies Expense	$          1,120
	Supplies		$          1,120
31c.	Unearned Service Revenue	$          2,220
	Service Revenue		$          2,220
31d.	Interest Expense	$             125
	Interest Payable		$             125
31e.	Depreciation Expense	$             600
	Accumulated Depreciation		$             600
31f.	Salaries Expense	$          2,960
	Salaries Payable		$          2,960
31g.	Insurance Expense	$             500
	Prepaid Insurance		$             500
	Rent Expense	$             400
	Prepaid Rent		$             400

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