Question

Required information The following information applies to the questions displayed below.) The general ledger of Pipers Plumbing at January 1, 2021, includes the following account balances: Accounts Debit Credits Cash $ 3,950 Accounts Receivable 8,950 Supplies 2,950 Equipment 25,000 Accumulated Depreciation $ 5,800 Accounts Payable 3,800 Utilities Payable Deferred Revenue Common stock 17,500 Retained Earnings Totale 540,850 $40,850 The following is a summary of the transactions for the year. 1. January 24 Provide plumbing services for cash, $14,500, and on account, $59.500. 2. Mareh 13 Collect on accounts receivable, 547,500. 6 Issue shares of common stock in exchange for $12,000 cash. 4. June 30 May salaries for the current year, $31.900. 5. September 15 Pay utilities of $4,800 from 2020 (prior year). 6. November 24 Receive cash in advance from customers, $7.800. 7. December 30 Pay $1,900 cash dividends to stockholders. The following information is available for the adjusting entries. Depreciation for the year on the machinery is $5,800. Plumbing supplies remaining on hand at the end of the year equal $1.200. Of the $7,800 paid in advance by customers, 55,900 of the work has been completed by the end of the year. Accrued utilities at year-end amounted to $7100. 8-a. Prepare an income statement for the year ended December 31, 2021. < Prev of 9 Next > MacBook Pro Q @ # $ 4 & 7 C 9 2 3 5 6 8 0 W E R T Y 0 S D F G H J

Answer 1

1. Journal Entries -

Date Credit Jan 24 Pipers Plumbing Journal Entries Accounts Title Debit Cash $ 14,500 Accounts Receivable $ 59,500 Plumbing Service (Being Plumbing services earned) $ 74,000 Mar 13 Cash $ 47,500 Accounts Receivable (Being amount received on account) $ 47,500 May 6 Cash $ 12,000 Common Stock $ 12,000 (Being cash received against common stock) June 30 Salaries Expense $ 31,900 Cash (Being Salaries Expeses paid) $ 31,900 Sept 15 Utilities Payable $ 4,800 Cash (Being Utilities Paid) $ 4,800 Nov 24 Cash $ 7,800 Deferred Revenue (Being advance received) $ 7,800 Dec 30 Dividend $ 1,900 Cash (Being dividend paid) $ 1,900

2. Adjusting Entries -

Credit Pipers Plumbing Adjusting Entries Date Accounts Title Debit Dec 31 Depreciation Expense $ 5,800 Accumulated Depreciation (Being Depreciation expense incurred) $ 5,800 Dec 31 Supplies Expense $ 1,750 Supplies (Being Supplies Utilised) $ 1,750 Dec 31 Deferred Revenue $ 5,900 Plumbing Service (Being Service revenue Earned) $ 5,900 Dec 31 Utilities Expense $ 7,100 Utilities Payable (Being Utilities Expense accrued) $ 7,100

3. Income Statement -

Pipers Plumbing Income Statement For the Year ended December 31, 2021 Plumbing Service $ 79,900 Expenses: Salaries Expense Supplies Expense Depreciation Expense Utilities Expense $ 31,900 $ 1,750 $ 5,800 $ 7,100 $ 46,550 Net Income $ 33,350

4. Balance Sheet -

Pipers Plumbing Balance Sheet December 31, 2021 Liabilities Assets Current Assets: Cash Accounts Receivable Supplies Current Liabilities: $ 47,150 Accounts Payable $ 20,950 Utilities Payable $ 1,200 Deferred Revenue $ 3,800 $ 7,100 $ 1,900 $ 69,300 Total Current Liabilities $ 12,800 Total Current Assets Long Term Assets: Equipment Accumulated Depreciation $ 25,000 Stockholder's Equity $(11,600) Common Stock Retained Earnings (-) Dividends (+) Net Income $ 29,500 $ 8,950 $ (1,900) $ 33,350 Total Stockholder's Equity $ 69,900 $ 82,700 Total Liabilities & Stockholder's Equity $ 82,700 Total Assets