Problem

Preparing an Income Statement and Balance SheetClay Corporation was organized by five indi...

Preparing an Income Statement and Balance Sheet

Clay Corporation was organized by five individuals 011 January 1, 2011. At the end of January 2011, the following monthly financial data are available:

Total revenues

$299,000

Total expenses (excluding income taxes)

184,000

Income tax expense (all unpaid as of January 31)

34,500

Cash balance, January 31, 2011

70,150

Receivables from customers (all considered collectible)

34,500

Merchandise inventory (by inventory count at cost)

96,600

Payables to suppliers for merchandise purchased from them (will be paid during February 2011)

2 26,450

Contributed capital (2,600 shares)

59,800

No dividends were declared or paid during 2011.

Required:

Complete the following two statements:

CLAY CORPORATION

Income Statement

For the Month of January 2011

Total revenues

$

Less: Total expenses (excluding income tax)

 

 

Pretax income

 

Less: Income tax expense

 

Net income

$

 

CLAYCORPORATION

Balance Sheet

At January 31, 2011

Assets

 

 

Cash

$

Receivables from customers

 

Merchandise inventory

 

Total assets

$

Liabilities

 

Payables to suppliers

 

$

Income taxes payable

 

 

Total liabilities

 

 

Stockholders' Equity

 

 

Contributed capital

 

 

Retained earnings

 

Total stockholders' equity

 

Total liabilities and stockholders' equity

$

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