zetablue1
Sep 4, 2009, 01:09 PM
D=debit, C=credit
This problem started as a worksheet to be completed. Completed that part and the numbers balanced. The next part is E4-3 Worksheet data for Goode Company are presented in E4-2. No common stock was issued during April. Instructions. Prepare an income statement, a retained earnings statement, and a classified balance sheet. What is the significance of no common stock issued?
This is how I calculated net and retained:
Service Revenue C $15,590
Salaries Expense D 10,840
Rent Expense D 760
Depreciation Expense D 671
Interest Expense D 57
Total Expenses D 12,328
Total Revenue C 15,590
Net income 3,262
Retained Earnings, April 1, $5,960
Add: Net income, 3,262
9,222
Less: Dividends, 3,650
Retained Earnings, April 30, 5,572
Balance sheet
Current assets
Cash C 13,752
Accounts receivable C 7,840
Prepaid Rent C 2,280
Property, plant and equipment
Equipment C 23,050
Less: Acc Depreciation D 4,921
Total assets 42,001
Liabilities and Stockholders Equity
Current liabilities
Notes payable C 5,700
Accounts payable C 5,672
Interest payable C 57
Total current liabilities 11,429
Stockholders Equity
Common stock C 25,000
Retained Earnings C 5,572
Total stockholders equity 30,572
Total liabilities and stockholders equity 42,001
The last part of the problem:
(a) Journalize the closing entries at April 30.
(b) Post the closing entries to Income Summary and Retained Earnings. Use T accounts.
(c) Prepare a post-closing trial balance at April 30.
(a). Closing Entries
Service Revenue D 15,590
Income Summary C 15,590
(To close revenue account)
Income Summary D 12,328
Salaries Expense C 10,840
Rent Expense C 760
Depreciation Expense C 671
Interest Expense C 57
(To close expense accounts)
Income Summary D 3,262
Retained Earnings C 3,262
(To close net income to retained earnings)
Retained Earnings D 3,650
Dividends C 3,650
(To close dividends to capital)
(b).
Totaled all expenses to income summary totaling D 12,328
D net income 3,262 totaled net and exp equaled service rev C 15,590
To retained earnings D dividends 3,650. Credit net income 3,262 to retained earnings. The difference between these two is 388. This is where my problem lies. When I try to balance the closing trial balance D and C are not equal. Can you tell me where I have gone wrong with this problem?
Closing trial balance
Cash D 13,752
Accounts receivable D 7,840
Equipment D 23,050
Less: Acc Depreciation C 4,921
Notes Payable C 5,700
Accounts payable C 5,672
Interest payable C 57
Common stock C 25,000
Retained earnings C (388)
Total D 46,922 C 40,962
This problem started as a worksheet to be completed. Completed that part and the numbers balanced. The next part is E4-3 Worksheet data for Goode Company are presented in E4-2. No common stock was issued during April. Instructions. Prepare an income statement, a retained earnings statement, and a classified balance sheet. What is the significance of no common stock issued?
This is how I calculated net and retained:
Service Revenue C $15,590
Salaries Expense D 10,840
Rent Expense D 760
Depreciation Expense D 671
Interest Expense D 57
Total Expenses D 12,328
Total Revenue C 15,590
Net income 3,262
Retained Earnings, April 1, $5,960
Add: Net income, 3,262
9,222
Less: Dividends, 3,650
Retained Earnings, April 30, 5,572
Balance sheet
Current assets
Cash C 13,752
Accounts receivable C 7,840
Prepaid Rent C 2,280
Property, plant and equipment
Equipment C 23,050
Less: Acc Depreciation D 4,921
Total assets 42,001
Liabilities and Stockholders Equity
Current liabilities
Notes payable C 5,700
Accounts payable C 5,672
Interest payable C 57
Total current liabilities 11,429
Stockholders Equity
Common stock C 25,000
Retained Earnings C 5,572
Total stockholders equity 30,572
Total liabilities and stockholders equity 42,001
The last part of the problem:
(a) Journalize the closing entries at April 30.
(b) Post the closing entries to Income Summary and Retained Earnings. Use T accounts.
(c) Prepare a post-closing trial balance at April 30.
(a). Closing Entries
Service Revenue D 15,590
Income Summary C 15,590
(To close revenue account)
Income Summary D 12,328
Salaries Expense C 10,840
Rent Expense C 760
Depreciation Expense C 671
Interest Expense C 57
(To close expense accounts)
Income Summary D 3,262
Retained Earnings C 3,262
(To close net income to retained earnings)
Retained Earnings D 3,650
Dividends C 3,650
(To close dividends to capital)
(b).
Totaled all expenses to income summary totaling D 12,328
D net income 3,262 totaled net and exp equaled service rev C 15,590
To retained earnings D dividends 3,650. Credit net income 3,262 to retained earnings. The difference between these two is 388. This is where my problem lies. When I try to balance the closing trial balance D and C are not equal. Can you tell me where I have gone wrong with this problem?
Closing trial balance
Cash D 13,752
Accounts receivable D 7,840
Equipment D 23,050
Less: Acc Depreciation C 4,921
Notes Payable C 5,700
Accounts payable C 5,672
Interest payable C 57
Common stock C 25,000
Retained earnings C (388)
Total D 46,922 C 40,962