Log out Go to App
Go to App

Learning Materials

Features

Discover

Chapter 1: Q42PGA_3 (page 45)

Presented here are the accounts of Hometown Décor Company for the year ended December 31, 2018. Land \( 13,000 Common Stock \) 28,000 Notes Payable 33,000 Accounts Payable 14,000 Property Tax Expense 2,800 Accounts Receivable 800 Dividends 36,000 Advertising Expense 17,000 Rent Expense 14,000 Building 170,400 Salaries Expense 67,000 Cash 2,800 Salaries Payable 1,300 Equipment 17,000 Service Revenue 225,000 Insurance Expense 1,700 Office Supplies 8,000 Interest Expense 6,800 Retained Earnings, Dec. 31, 2017 56,000 Requirements 1. Prepare Hometown Décor Company’s income statement. 2. Prepare the statement of retained earnings. 3. Prepare the balance sheet

Short Answer

Expert verified

Hometown Décor Company

Balance Sheet

December 31, 2018

Assets
Liabilities

Cash

$2,800

Salaries Payable

$1,300

Building

170,400

Accounts Payable

14,000

Office Supplies

8,000

Notes Payable

33,000

Accounts Receivable

800

Total Liabilities

48,300

Equipment

17,000

Stockholders’ Equity

Land

13,000

Common Stock

28,000

Retained Earnings

135,700

Total Stockholders’ Equity

163,700

Total Assets

$212,000

Total Liabilities and Stockholders’ Equity

$212,000

Step by step solution

01

Explanation on Balance Sheet

Balance sheet reports the balances of assets, liabilities, and stockholders’ equity for the particular accounting period.

02

Details of balance sheet

In the balance sheet, total assets equals $212,000, total liabilities equals $48,300, and total stockholders’ equity equals $163,700.

Unlock Step-by-Step Solutions & Ace Your Exams!

  • Full Textbook Solutions

    Get detailed explanations and key concepts

  • Unlimited Al creation

    Al flashcards, explanations, exams and more...

  • Ads-free access

    To over 500 millions flashcards

  • Money-back guarantee

    We refund you if you fail your exam.

Start your free trial

Over 30 million students worldwide already upgrade their learning with Vaia!

One App. One Place for Learning.

All the tools & learning materials you need for study success - in one app.

Get started for free

Most popular questions from this chapter

Cosmo Thomas started a new business, Thomas Gymnastics, and completed the following transactions during December: Dec. 1 Received \(19,000 cash from Thomas in exchange for common stock. 2 Received \)3,800 cash from customers for services performed. 5 Paid \(300 cash for office supplies. 9 Performed services for a customer and billed the customer for services rendered, \)4,500. 10 Received \(150 invoice for utilities due in two weeks. 15 Paid for advertising in the local paper, \)350. 20 Paid utility invoice received on Dec. 10. 25 Collected cash in full from customer billed on Dec. 9. 28 Paid rent for the month, \(2,600. 28 Paid \)1,200 to assistant for wages. 30 Received \(1,600 cash from customers for services performed. 31 Cash dividends of \)3,000 were paid to stockholders. Analyze the effects of the transactions on the accounting equation of Thomas Gymnastics using a format similar to Exhibit 1-6.

Suppose you are starting a business, Wholly Shirts, to imprint logos on T-shirts. In organizing the business and setting up its accounting records, you take your information to a CPA to prepare financial statements for the bank. Name the organization that governs the majority of the guidelines that the CPA will use to prepare financial statements for Wholly Shirts. What are those guidelines called?

You would like to start a cellular telephone equipment service business. You are considering organizing the business as a sole proprietorship. Identify the advantages and disadvantages of owning a sole proprietorship.

Which concept states that accounting information should be complete, neutral, and free from material error?

Identifying accounts Consider the following accounts: a. Accounts Payable b. Cash c. Common Stock d. Accounts Receivable e. Rent Expense f. Service Revenue g. Office Supplies h. Dividends i. Land j. Salaries Expense Identify each account as Asset, Liability, or Equity
See all solutions

Recommended explanations on Business Studies Textbooks

Business Operations

Read Explanation

Strategic Analysis

Read Explanation

Organizational Behavior

Read Explanation

Financial Performance

Read Explanation

Operational Management

Read Explanation

Strategic Direction

Read Explanation
View all explanations

What do you think about this solution?

We value your feedback to improve our textbook solutions.

Study anywhere. Anytime. Across all devices.

Sign-up for free