Question

Exercise 4-6 (Part Level Submission) Franken Company, a ski tuning and repair shop, opened on November 1, 2016. The company carefully kept track of all its cash receipts and cash payments. The follov information is available at the end of the ski season, April 30, 2017. Issuance of common shares Cash Cash Receipts Payments $20,000 $9,200 1,225 375 Payment to purchase repair shop equipment Payments to landlord Newspaper advertising payment Utility bill payments Part-time helper's wage payments Income tax payment Cash receipts from ski and snowboard repair services 970 2,600 10,000 32,150 Subtotals 52,150 Cash balance 24,370 27,780 $52,150 Totals $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 e The payments to the landlord included a security deposit of $175. The part-time helper is owed $420 at April 30, 2017, for unpaid wages. At April 30, 2017, customer Franken Company $540 for services they have received but have not yet paid for.

Answer 1

Solution

Franken Company
Balance Sheet
April 30, 2017
		Assets
Current Assets
Cash			27,780
Account Receivables	540
Prepaid Rent		175
Total Current Assets			28,495
Property, Plant & Equipment
Equipment		9,200
less:
Accumulated Depreciation - Equipment	1,150		8,050
Total Assets				36,545
		Liabilities & Stakeholder's Equity
Current Liabilities
Salaries and Wages Payable	420		420
Stakeholder's Equity
Common Stock		20,000
Retained Earnings**		16,125
Total Stakeholder's Equity			36,125
Total Liabilities & Stakeholder's Equity			36,545

Note** Retained Earnings

Revenue = 32,690

less Expenses

Income Tax Payment = 10,000

Salary and Wages = 3,020

Utility Bill    = 970

Depreciation = 1,150

Rent payment = 1,050

Advertising Payment = 375

Net Income = 16,125