Question

Required information Problem 3-5A Preparing financial statements from the adjusted trial balance and computing profit margin LO P3, A1, A2 {The following information applies to the questions displayed below.] The adjusted trial balance for Chiara Company as of December 31, 2017, follows. Credit Debit $ 140,800 55,500 18,400 169,000 16,000 174,000 65,000 140,000 26,000 83,000 Cash Accounts receivable Interest receivable Notes receivable (due in 90 days) Office supplies Automobiles Accumulated depreciation-Automobiles Equipment Accumulated depreciation-Equipment Land Accounts payable Interest payable Salaries payable Unearned fees Long-term notes payable Common stock Retained earnings Dividends Fees earned Interest earned Depreciation expense-Automobiles Depreciation expense-Equipment Salaries expense Wages expense Interest expense Office supplies expense Advertising expense Repairs expense-Automobiles Totals 104,000 20,000 26,000 40,000 152,000 34,580 311,220 48,000 484,000 24,000 27,000 20,000 185,000 46,000 36,800 34,200 65,500 27,600 $1,286,800 $1,286,800

Answer 1

Income Statement $ 484,000 24,000 $ $ 508,000 Less $ Revenue Fees Earned Interest Earned Total Revenue Expenses: Depreciation Expense-Automobiles Depreciation Expense-Equiment Salaries Expense Wages Expense Interest Expense Office Supplies Expense Advertising Expense Repair Expense-Automobiles Total Expense Net Income $ S $ $ $ $ $ 27,000 20,000 185,000 46,000 36,800 34,200 65,500 27,600 $ $ 442,100 65,900 Income Statement shows profit or loss made by a company within specific time period.Deduct all expenses incurred during a period from revenue of the period to calculate Net income / loss. Retained Earning Statement Retained earning Beginning Balance Net Income Add $ $ $ $ $ 311,220 65,900 377,120 48,000 329,120 Less Dividend Retained earning Ending Balance Add any income earned or deduct any loss incurred by the company in the beginning retained earning balance and deduct dividend declared or paid for the year. Balance sheet For the year ended on Dec 31 Assets 140,800 55,500 18,400 169,00 16,000 Cash Accounts Receivables Interest Receivables Notes Receivables Office Supplies Automobiles Accumulated Depreciation Equipment Accumulated Depreciation Land $ $ $ $ $ 174,000 65,000 $ 140,000 26,000 $ $ Less 109,000 $ $ $ $ Less 114,000 83,000 Total assets $ 705,700 Liabilities & Stockholder's Equity Liabilities Accounts Payable Interest Payable Salaries Payable Unearned Fees Long Term Notes Payable Total Liabilities $ $ $ 104,000 20,000 26,000 40,000 152,000 S $ $ 342,000 Stockholders Equity Common Stock Retained Earning Total Stockholders Equity Add $ $ $ 34,580 329,120 363,700 Total Liabilities & Stockholder's Equity $ 705,700