Question

Question 7 Sandhill's Home Renovations was started in 2008 by Jim Sandhill. Jim operates the business from an office in his home. Listed below, in alphabetical order, are the company's assets and liabilities as at December 31, 2021, and the revenues, expenses, and drawings for the year ended December 31, 2021: Accounts payable $7,925 Operating expenses $3,457 Accounts receivable 10,556 Prepaid insurance 1,364 Cash 9,246 Salaries expense 88,033 Equipment 29,037 Service revenue 157,710 Insurance expense 3,392 Supplies 774 Interest expense 1,082 Supplies expense 20,890 J. Sandhill, drawings 44,438 Unearned revenue 14,444 Notes payable 30,548 Vehicles 41,870 Jim's capital at the beginning of 2021 was $43,512. He made no investments during the year. (al) Prepare the income statement. SANDHILL'S HOME RENOVATIONS Income Statement

b) trail balance ?

c) owners equity ?

Answer 1

$ $ Sandhill's Home Renovations Trial Balance December 31, 2021 Cash $ 9,246 Accounts receivable $ 10,556 Prepaid insurance $ 1,364 Supplies $ 774 Equipment $ 29,037 Vehicles $ 41,870 Notes payable $ Accounts payable $ Unearned revenue $ J. Sandhill, capital $ J. Sandhill, drawings $ 44,438 Service revenue $ Insurance expense $ 3,392 Interest expense $ 1,082 Operating expenses $ 3,457 Salaries expense $ 88,033 Supplies expense $ 20,890 Total $ 254,139 $ 30,548 7,925 14,444 43,512 $ 157,710 $ 254,139

Sandhill's Home Renovations Income Statement Year Ended December 31, 2021 $ 157,710 Revenue Service revenue Expenses Insurance expense Interest expense Operating expenses Salaries expense Supplies expense Total expenses Net income $ $ $ $ $ 3,392 1,082 3,457 88,033 20,890 $ $ 116,854 40,856

$ Sandhill's Home Renovations Balance Sheet December 31, 2021 ASSETS Current assets Cash Accounts receivable Supplies Prepaid insurance Total current assets Non-current assets Equipment Vehicles Total non-current assets Total assets $ $ $ $ $ 9,246 10,556 774 1,364 21,940 $ $ $ $ 29,037 41,870 70,907 92,847

$ $ $ 7,925 14,444 22,369 LIABILITIES AND OWNER'S EQUITY Liabilities Current liabilities Accounts payable Unearned revenue Total current liabilities Other liabilities Notes payable Total liabilities Owner's equity Capital $ 43,512 Add: Net income $ 40,856 Less: Drawings $ (44,438) Total owner's equity Total liabilities and shareholders' equity $ $ 30,548 52,917 $ $ $ 39,930 92,847