Presented below are the amounts of (a) the assets and liabilities of Superior Marketing Consultants as of December 31, 2014 and (b) the revenues and expenses of the company for the year ended December 31, 2014. The items are listed in alphabetical order.

The opening balance of owner's equity was $300,000. At year end, after the calculation of net income, the owner, Susan Wong, withdrew $103,500.
Required
1. Prepare the business's income statement for the year ended December 31, 2014.
2. Prepare the statement of owner's equity of the business for the year ended December 31, 2014.
3. Prepare the balance sheet of the business at December 31, 2014.
4. Answer these questions about the business:
a. Was the result of operations for the year a profit or a loss? How much was it?
b. Did the business's owner's equity increase or decrease during the year? How would this affect the business's ability to borrow money from a bank in the future?
c. How much in total economic resources does the business have at December 31, 2014, as it moves into the New Year? How much does the business owe? What is the dollar amount of the owner's portion of the business at December 31, 2014?

Transcribed Image Text:

Accounts Payable. Accounts Receivable.. Advertising Expense. Insurance Expense. Interest Expense Land . Note Payable. Salary Expense. Salary Payable. Service Revenue Supplies .. $ 4,500 15,000 37,500 195,000 240,000 22,500 450,000 $ 57,000 36,000 48,500 300,000 15,000 165,000 7,000 45,000 Building. Cash.. | Computer Equipment.. Courier Expense. Furniture.. 7,500