Concept explainers
Problem 1-60A Income Statement and
The following information for Rogers Enterprises is available at December 31, 2019 and includes all of Rogers’ financial statement amounts except retained earnings:
Required:
Prepare a single-step income statement and a c1assified balance sheet for the year ending
December 31, 2019, for Rogers.
Concept Introduction:
Balance Sheet: The Balance sheet is a summary of Assets, Liabilities and equity accounts that reports the financial position of the business as on a specific date. Assets are further classifies into Current Assets, Long Term Investments, Plant Assets and Intangible assets. And Liabilities are further classified into Current Liabilities and Long term liabilities.
Income Statement:
Income Statement is the part of the financial statement which is prepared to calculate the net income earned by the organization. In the income statement, all expenses are subtracted from the revenues to calculate the net income. It is prepared for a particular period.
There are two ways to present and income statement: Single-step and Multi-step. In the, multi-step income statement the net income calculated after showing multiple steps. In this statement operating and items are separate from non operating items.
To Prepare:
A single step income statement and classifies balance sheet for Rogers Enterprises.
Answer to Problem 60APSA
A single step income statement and classifies balance sheet for Rogers Enterprises are as follows:
Rogers Enterprises | ||
Single Step Income Statement | ||
For the year ended Dec. 31, 2019 | ||
Revenues: | ||
Service Revenue | $463,500 | |
Total Revenues (A) | $463,500 | |
Less: Expenses: | ||
Salaries expense | $235,200 | |
Rent Expense | $135,000 | |
Supplies Expense | $34,400 | |
Interest Expense | $16,000 | |
Income tax Expense | $12,800 | |
Total Expenses (B) | $433,400 | |
Net Income (A-B) | $30,100 |
Rogers Enterprises | ||
Balance Sheet | ||
As on Dec. 31, 2019 | ||
ASSETS | ||
Current Assets: | ||
Cash | $ 13,240 | |
Accounts Receivables | $ 72,920 | |
Supplies | $ 42,000 | |
Prepaid Rent | $ 31,500 | $ 159,660 |
Property, Plant and Equipment: | $ 90,000 | |
Total Assets | $ 249,660 | |
LIABILITIES AND EQUITY | ||
LIABILITIES | ||
Current Liabilities: | ||
Income Taxes Payable | $ 4,150 | |
Salaries Payable | $ 14,800 | $ 18,950 |
Long Term Liabilities: | ||
Notes Payable | $ 25,000 | |
Equity: | ||
Common Stock | $ 70,000 | |
Retained earnings | $ 135,710 | $ 205,710 |
Total Liabilities and Equity | $ 249,660 |
Explanation of Solution
A single step income statement and classifies balance sheet for Rogers Enterprises are prepared as follows:
Rogers Enterprises | ||
Single Step Income Statement | ||
For the year ended Dec. 31, 2019 | ||
Revenues: | ||
Service Revenue | $463,500 | |
Total Revenues (A) | $463,500 | |
Less: Expenses: | ||
Salaries expense | $235,200 | |
Rent Expense | $135,000 | |
Supplies Expense | $34,400 | |
Interest Expense | $16,000 | |
Income tax Expense | $12,800 | |
Total Expenses (B) | $433,400 | |
Net Income (A-B) | $30,100 |
Rogers Enterprises | ||
Balance Sheet | ||
As on Dec. 31, 2019 | ||
ASSETS | ||
Current Assets: | ||
Cash | $ 13,240 | |
Accounts Receivables | $ 72,920 | |
Supplies | $ 42,000 | |
Prepaid Rent | $ 31,500 | $ 159,660 |
Property, Plant and Equipment: | $ 90,000 | |
Total Assets | $ 249,660 | |
LIABILITIES AND EQUITY | ||
LIABILITIES | ||
Current Liabilities: | ||
Income Taxes Payable | $ 4,150 | |
Salaries Payable | $ 14,800 | $ 18,950 |
Long Term Liabilities: | ||
Notes Payable | $ 25,000 | |
Equity: | ||
Common Stock | $ 70,000 | |
Retained earnings | $ 135,710 | $ 205,710 |
Total Liabilities and Equity | $ 249,660 |
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Chapter 1 Solutions
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