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Chapter 4: Q4RQ (page 216)
What does the balance sheet report?
Balance sheet reports the assets, liabilities and stockholders’ equity as at the end of the accounting period.
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What is a classified balance sheet?
Winters Landscape Services accrued \(4,000 of Salaries Expense at December 31. Winters paid the next payroll at January 10 of
\)6,000. This payment included the accrued amount at December 31, plus $2,000 for the first few days of January.
23A. Record the adjusting entry to accrue Salaries Expense
E4-20 Preparing financial statements from the completed worksheet Use your answer from Exercise E4-19 to prepare Data Solution’s financial statements. Requirements 1. Complete the income statement for the month ended November 30, 2018. 2. Complete the statement of retained earnings for the month ended November 30, 2018. Assume beginning Retained Earnings was $0. 3. Complete the classified balance sheet as of November 30, 2018. Use the report form.
The unadjusted trial balance of Watson Anvils at December 31, 2018, and the data for the adjustments follow: WATSON ANVILS Unadjusted Trial Balance December 31, 2018 Account Title Prepaid Rent Cash Debit Credit Accounts Receivable Office Supplies Equiment Accumulated Depreciation—Equipment Accounts Payable Salaries Payable Unearned Revenue Dividends Common Stock Service Revenue Salaries Expense Rent Expense Depreciation Expense—Equipment Supplies Expense Total Balance \( 13,560 \) 72,400 \( 72,400 5,600 4,600 12,000 Retained Earnings 17,600 19,000 17,000 2,140 2,800 \) 11,000 7,200 30,000 2,300. Adjustment data: a. Unearned Revenue still unearned at December 31, \(3,600. b. Prepaid Rent still in force at December 31, \)2,000. c. Office Supplies used, \(600. d. Depreciation, \)400. e. Accrued Salaries Expense at December 31, $180. Requirements 1. Open the T-accounts using the balances in the unadjusted trial balance. 2. Complete the worksheet for the year ended December 31, 2018 (optional). 3. Prepare the adjusting entries, and post to the accounts. 4. Prepare an adjusted trial balance. 5. Prepare the income statement, the statement of retained earnings, and the classified balance sheet in report form. 6. Prepare the closing entries, and post to the accounts. 7. Prepare a post-closing trial balance. 8. Calculate the current ratio for the company.
Benson Auto Repair has the following account balances at December 31, 2018, from its adjusted trial balance. Compute
Benson Auto Repair’s current ratio.
Cash \( 4,000 Common Stock \) 20,000
Accounts Receivable 3,200 Retained Earnings 15,700
Prepaid Rent 1,900 Dividends 2,100
Office Supplies 3,000 Service Revenue 1,600
Equipment 34,800 Depreciation Expense—Equipment 300
Accumulated Depreciation—Equipment 1,600 Salaries Expense 800
Accounts Payable 5,400 Rent Expense 500
Notes Payable (long-term) 7,000 Utilities Expense 600
Supplies Expense 100
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