Question

Analyze the data above and prepare an income statement and a retained earnings statement for the year ending Dec 31, 2017

The following information relates to Radio Repair Company for the year 2017: Retained earnings, January 1, 2017 $59,000 Advertising expense 1,800 Dividends paid during 2017 9,000 Rent expense 10,400 Service revenue 52,000 Utilities expense 2,400 Salaries and wages expense 25,000 Required After analyzing the above data, prepare an Income Statement and a Retained Earnings Statement for the year ending December 31, 2017

Answer 1

Based on the information available in the question, we can answer as follows:-

Requirement A:-

Particulars	Amount
Service revenue	52,000
Less:-
Advertising expense	1,800
Rent expense	10,400
Utilities expense	2,400
Salaries and wages expense	25,000
Net Income	12,400

Requirement B:-

Retained Earnings Statement
Particulars	Amount
Retained Earnings January 1, 2017	59,000
Net Income	12,400
Earnings available for common shareholders	71,400
Less:- Dividends paid	(9,000)
Retained Earnings December 31, 2017	62,400

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