Question

You are now asked to prepare the following financial statements:

• Income statement.This statement is prepared to help assess the financial performance of the business. It summarizes the revenues earned and expenses incurred over the month of June.
• Statement of stockholders' equity.This statement shows the movements in equity over the month of June.
• Balance sheet. This statement reports the financial position of the business at the end of June. It presents the assets, liabilities and equity of the business as at June 30, 2020.

Bean Counters Coffeehouse Worksheet For the month ended June 30, 2020 Unadjusted Trial Adjusted Trial Balance Balance Income Statement Balance Sheet Acct. No. Account Name Adjustments Debit Credit Debit Credit Debit Credit Debit Credit Debit Credit 100 Cash 151,866 151,866 151,866 110 ARC - Accounts Receivable Control 74,462 74,462 74,462 120 Merchandise Inventory 23,252 23,252 23,252 130 Office Supplies 4,382 438 3,944 3,944 140 Prepaid Rent 9,500 4.750 4,750 4,750 8,000 12,000 4.000 8,000 141 Prepaid Advertising 142 Prepaid Insurance 4,200 840 3,360 3,360 150 Office Furniture 7.000 7,000 7,000 151 Accum Depn: Office Furniture 1,083 83 1,166 1,166 160 Office Equipment 51,000 51,000 51,000 16,875 375 17,250 17,250 161 Accum Depn: Office Equipment 210 APC - Accounts Payable Control 40,956 40.956 40,956 1,860 1,860 1,860 220 Wages Payable 221 Electricity Payable 63 240 303 303 1,120 1,155 2,275 2,275 200 200 200 222 Water Payable 225 Interest Payable 250 Bank Loan Payable 300 Common Stock 301 Retained Earnings 40,000 40,000 40.000 45.000 45,000 45,000 148,351 148,351 148,351 136,724 136,724 136,724 400 Sales Revenue 401 Sales Returns and Allowances 4,900 4,900 4,900 402 | Sales Discounts 293 293 293 403 Interest Revenue 585 585 585 500 Cost of Goods Sold 76,354 76,354 76,354 4,000 4,000 4,000 511 Advertising Expense 516 Wages Expense 7,438 1,860 9,298 9,298 540 Rent Expense 4,750 4,750 4,750 240 240 240 1.155 1,155 1.155 541 Electricity Expense 542 Water Expense 543 Insurance Expense 544 Office Supplies Expense 545 Salary Expense 840 840 840 438 438 438 4,100 4,100 4,100 560 Depn Expense: Office Furniture 83 83 83 561 Depn Expense: Office Equipment 375 375 375 571 Interest Expense 200 200 200 572 Admin. Expense - Bank Charges 10 10 10 Totals 430,757 430.757 13,941 13,941 434,670 434,670 107,036 137,309 327,634 297,361 Net income or loss 30,273 30,273 Totals 137,309 137,309 327,634 327,634

Answer 1

1. Income Statement -

Bean Counters Cofeehouse Income Statement For the month ended June 30, 2020 INCOME: Revenue Sales Revenue $ 136,724 (-) Sales Return & Allowances $ (4,900) (-) Sales Discounts $ (293) Net Sales Revenue Cost of Good Sold Gross Profit $ 131,531 $ 76,354 $ 55,177 $ 4,000 $ 4,000 OPERATING EXPENSES: Selling Expenses: Advertising Expenses Total Selling Expenses General and Administrative Expense: Wages Expenses Rent Expense Electricity Expense Water Expense Insurance Expense Office Supplies Expense Salary Expense Depreciation Expense - Office Furniture Depreciation Expense - Office Equipment Admin. Expense - Bank Charges Total General and Administrative Expense Total Operating Expense Income from operation Other Revenues: Interest Revenue Other Expenses: Interest Expenses $ 9,298 $ 4,750 $ 240 $ 1,155 $ 840 $ 438 $ 4,100 $ 83 $ 375 $ 10 $ 21,289 $ 25,289 $ 29,888 $ 585 $ 200 Net Income $ 30,273

2. Statement of Stockholder's Equity -

Bean Counters Cofeehouse Statement of Stockholder's Equity For the month ended June 30, 2020 COMMON STOCK Opening Balance, May 31, 2020 Issue of common stock Closing Balance, June 30, 2020 $ $ 45,000 $ 45,000 RETAINED EARNINGS Opening Balance, May 31, 2020 Net Income for the period Dividend Paid Closing Balance, June 30, 2020 $ 148,351 $ 30,273 $ $ 178,624 Total Stockholder's Equity $223,624

3. Balance Sheet -

Bean Counters Cofeehouse Balance Sheet June 30, 2020 ASSETS Current Assets: Cash $ 151,866 ARC - Accounts Receivable Control $ 74,462 Merchandise Inventory $ 23,252 Office Supplies $ 3,944 Prepaid Rent $ 4,750 Prepaid Advertising $ 8,000 Prepaid Insurance $ 3,360 Total Current Assets $ 269,634 Property Plant and Equipment Office Furniture Acccumulated Depr - Office Furniture Office Equipment Acccumulated Depr - Office Equipment Total Property Plant and Equipment $ 7,000 $ (1,166) $ 51,000 $ (17,250) $ 39,584 TOTAL ASSETS $ 309,218 LIABILITIES Current Liabilities: APC - Accounts Payable Control Wages Payable Electricity Payable Water Payable Interest Payable Total Current Liabilities $ 40,956 $ 1,860 $ 303 $ 2,275 $ 200 $ 45,594 Long Term Liabilities: Bank Loan $ 40,000 Total Liabilities $ 85,594 STOCKHOLDER'S EQUITY Common Stock Retained Earnings Total Equity $ 45,000 $ 178,624 $ 223,624 TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY $ 309,218