Question

i Data Table Stone Sign Company Adjusted Trial Balance January 31, 2018 Balance Account Title Debit Credit Cash 15,400 Office Supplies 1,500 Prepaid Rent 1,400 Equipment 60,000 Accumulated Depreciation Equipment $ 7,000 Accounts Payable 3,800 Salaries Payable 100 Unearned Revenue 4,200 Notes Payable (long-term) 4,300 Common Stock 48,800 Dividends 800 $ Print Done

Answer 1

1)

Closing Entries

Date	Accounts and Explanation	Debit	Credit
January 31	Service Revenue	17,300
	Income Summary		17,300
	[Balance of service revenue transferred to income summary ]
January 31	Income Summary	6,400
	Salaries Expense		3,700
	Rent Expense		1,400
	Depreciation Expense - Equipment		400
	Supplies Expense		300
	Utilities Expense		600
	[Balances of expenses transferred to income summary ]
January 31	Income Summary	10,900
	Retained Earnings [ 17,300 - 6,400 ]		10,900
	[Net Profit transferred to retained earnings ]
January 31	Retained Earnings	800
	Dividends		800
	[Dividends declared and paid ]

Balance of Retained Earnings at year end of after declaration of dividend = $10,900 - $800 = $ 10,100

2) Net Income Earned by Stone Sign Company for the year ended January 31  = Total Revenue - Total Expenses

Total Revenue = Service Revenue = $ 17,300

Total Expenses = Salaries Expense + Rent Expense + Depreciation Expense Equipment + Supplies Expense + Utilities Expense

Total Expenses = $ 3,700 + $ 1,400 + $ 400 + $ 300 + $ 600 = $ 6,400

Net Income = Total Revenue - Total Expenses

Net Income = $ 17,300 - $ 6,400 = $ 10,900

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