Question

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[The following intormation applies to the questions displayed below.) On January 1, 2018, Red Flash Photography had the following balances: Cash, $16,000; Supplies, $8,400; Land, $64,000; Deferred Revenue, $5,400; Common Stock $54,000; Retained Earnings, $29,000. During 2018, the company had the following transactions: 1. February 15 Issue additional shares of common stock, $24,000. 2. May 20 Provide services to customers for cash, $39,000, and on account, $34,000. 3. August 31 Pay salaries to employees for work in 2018, $27,000. 4. October 1Purchase rental space for one year, $16,000. 5. November 17 Purchase supplies on account, $26,000. 6. December 30 Pay dividends, $2,400. The following information is available on December 31, 2018: 1. Employees are owed an additional $4,400 in salaries. 2. Three months of the rental space has expired. 3. Supplies of $5,400 remain on hand. 4. All of the services associated with the beginning deferred revenue have been performed. 3. Prepare an adjusted trial balance. Credit 78,000 RED FLASH PHOTOGRAPHY Adjusted Trial Balance December 31, 2018 Accounts Debit Cash $ 33,600 Supplies 5,400 Land 64,000 Common stock Retained earnings Salaries expense 31,400 Salaries payable Accounts receivable 34,000 Service revenue Prepaid rent 12,000 Rent expense 4,000 Supplies expense 29,000 Accounts payable 4,400 78,400 S 26,000 Totals S 213,400 S 186,800

Answer 1

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   Requirement (4) Red Flash photography Income Statement For the Year Ended December 31, 2018 Service Revenue $ 78,400 Requirement (4) Red Flash Photography Balance Sheet December 31,2021. Asset Liabities Cash $ 33,600 Accounts Payable Accounts Receivable $ 34,000 Salaries Payable Supplies $ 5,400 Total Current Liabilities Prepaid Rent $ 12,000 Stockholders Equity Total Current Assets $ 85,000 Common Stock Retained Earning Land $ 64,000 Total Stockholders Equity $ 26,000 $ 4,400 $ 30,400 Expenses : Rent Expense Supplies Expense Salaries Expense $ $ $ Requirement (3) Red Flash photography Adjusted Trial Balance December 31, 2018 Accounts Debit Credit Cash $ 33,600 Supplies $ 5,400 Accounts Receivable $ 34,000 Prepaid Rent $ 12,000 Land $ 64,000 Accounts Payable $ 26,000 Salaries Payable $ 4,400 Deferred Revenue Common Stock $ 78,000 Retained Earnings $ 29,000 Dividends $ 2,400 Service Revenue $ 78,400 Salaries Expense $ 31,400 Rent Expense $ 4,000 Supplies Expense $ 29,000 Totals $ 215,800 $ 215,800 4,000 29,000 31,400 $ 78,000 $ 40,600 $ 118,600 Total Expense Net Income $ $ 64,400 14,000 Total Assets $ 149,000 Total Liabities and Stockholders Equity $149,000 Note : Please comment down for any further clarifications. Requirement (4) Red Flash photography Statement of Stockholders Equity For the Year Ended December 31, 2018 Common Stock Retained Earnings Total Stockholders Equity Balance at Janaury 1 $ 54,000 $ 29,000 $ 83,000 Issuance of common stock $ 24,000 $ $ 24,000 Add : Net Income $ $ $ 14,000 $ 14,000 Less : Dividends $ $ (2,400 $ (2,400) Balance at December 31 $ 78,000 $ 40,600 $ 118,600