Question

The adjusted trial balance for Tybalt Construction as of December 31, 2019, follows. Credit $ Debit 5,000 23,000 8,100 7,000 40,000 $ 20,000 150,000 50,000 55,000 16,500 2,500 3,500 2,500 900 TYBALT CONSTRUCTION Adjusted Trial Balance December 31, 2019 No. Account Title 101 Cash 104 Short-term investments 126 Supplies 128 Prepaid insurance 167 Equipment 168 Accumulated depreciation-Equipment 173 Building 174 Accumulated depreciation-Building 183 Land 201 Accounts payable 203 Interest payable 208 Rent payable 210 Wages payable 213 Property taxes payable 233 Unearned professional fees 244 Current portion of long term note payable 251 Long-term notes payable 301 0. Tybalt, Capital 302 0. Tybalt, Withdrawals 401 Professional fees earned 406 Rent earned 407 Dividends earned 409 Interest earned 606 Depreciation expense-Building 612 Depreciation expense-Equipment 623 Wages expense 633 Interest expense 637 Insurance expense 640 Rent expense 652 Supplies expense 682 Postage expense 683 Property taxes expense 684 Repairs expense 688 Telephone expense 690 Utilities expense Totals 7,500 7,000 60,000 126,400 13,000 97,000 14,000 2,000 2,100 11,000 6,000 32,000 5,100 10,000 13,400 7,400 4,200 5,000 8,900 3,200 4,600 $411,900 $411,900 O. Tybalt invested $5,000 cash in the business during year 2019 (the December 31, 2018, credit balance of the O. Tybalt, Capital account was $121,400).

Answer 1

1a.

Income Statement
Revenues:
Professional fees earned	$          97,000.00
Rent earned	$          14,000.00
Dividends earned	$            2,000.00
Interest earned	$            2,100.00
Total revenues	$        115,100.00
Expenses:
Depreciation expense—Building	$          11,000.00
Depreciation expense—Equipment	$            6,000.00
Wages expense	$          32,000.00
Interest expense	$            5,100.00
Insurance expense	$          10,000.00
Rent expense	$          13,400.00
Supplies expense	$            7,400.00
Postage expense	$            4,200.00
Property taxes expense	$            5,000.00
Repairs expense	$            8,900.00
Telephone expense	$            3,200.00
Utilities expense	$            4,600.00
Total Expenses	$        110,800.00
Net Income	$            4,300.00

1b.

Statement of Owner’s Equity
O. Tybalt, Capital - Beginning Balance	$        121,400.00
Add: Net Income	$            4,300.00
Add: Capital Invested	$            5,000.00
Less: O. Tybalt, Withdrawals	$          13,000.00
O. Tybalt, Capital - Ending Balance	$        117,700.00

1c.

ASSETS
Current Assets:
Cash		$          5,000.00
Short-term investments		$        23,000.00
Supplies		$          8,100.00
Prepaid insurance		$          7,000.00
Total Current Assets			$      43,100.00
Plant, Property & Equipment
Equipment	$    40,000.00
Accumulated depreciation—Equipment	$ (20,000.00)	$        20,000.00
Building	$ 150,000.00
Accumulated depreciation—Building	$ (50,000.00)	$      100,000.00
Land		$        55,000.00
Total Plant, property & Equipment			$    175,000.00
Total ASSETS			$    218,100.00
LIABILITIES
Current Liabilities
Accounts payable	$    16,500.00
Interest payable	$      2,500.00
Rent payable	$      3,500.00
Wages payable	$      2,500.00
Property taxes payable	$         900.00
Unearned professional fees	$      7,500.00
Notes payable (current porton)	$      7,000.00
Total Current Liabilities		$        40,400.00
Other Liabilities
Long-term notes payable		$        60,000.00
Total LIABILITIES			$    100,400.00
OWNERS' EQUITY
O. Tybalt, Capital - Ending Balance			$    117,700.00
Total LIABILITIES & EQUITY			$    218,100.00

2.

Requirement 2: Closing Entries

Date	Accounts title	Debit	Credit
31-Dec-19	Professional fees earned	$          97,000.00
	Rent earned	$          14,000.00
	Dividends earned	$            2,000.00
	Interest earned	$            2,100.00
	Income Summary		$              115,100.00
	(revenue accounts closed)
31-Dec-19	Income Summary	$        110,800.00
	Depreciation expense—Building		$                11,000.00
	Depreciation expense—Equipment		$                  6,000.00
	Wages expense		$                32,000.00
	Interest expense		$                  5,100.00
	Insurance expense		$                10,000.00
	Rent expense		$                13,400.00
	Supplies expense		$                  7,400.00
	Postage expense		$                  4,200.00
	Property taxes expense		$                  5,000.00
	Repairs expense		$                  8,900.00
	Telephone expense		$                  3,200.00
	Utilities expense		$                  4,600.00
	(expense account closed)
31-Dec-19	Income Summary (115100-110800)	$            4,300.00
	O. Tybalt, Capital		$                  4,300.00
	(Net Income transferred)
31-Dec-19	O. Tybalt, Capital	$          13,000.00
	O. Tybalt, Withdrawals		$                13,000.00
	(Drawings account closed)