At the end of her first year of university, Nola Lam decided that she should start a business to help finance her education, so she set up her own courier service. She invested savings of $1,300 in the company, which she called Wroad Wrunner Ltd. In addition, her parents lent the company $4,300 to help it get started. Since this was a business venture, Nola insisted on paying interest on this loan, and her parents agreed to charge a rate of 6% per year.

Nola then negotiated the purchase of a used car for the business for $7,800. The company made a down payment of $3,000 on the car, and financed the remainder of the purchase price at an interest rate of 9% per year. Due to all of the kilometres that would be put on the car while it was used in the courier business, Nola estimated that the car could be sold at the end of the summer for $6,300.

Wroad Wrunner began operations on May 1, and continued until August 31. Although she did not keep any formal accounting records, at the end of the summer Nola put together the following additional information related to the business:

1.		During the summer, the company made payments of $624 on the car, which included interest of $144 and principal of $480.
2.		No payments (of either interest or principal) were made on the loan from her parents.
3.		Nola paid herself a salary of $1,600 per month for the four months that the business operated.
4.		Payments for other operating costs (including advertising, insurance, and gas) totalled $9,500. In addition, there were unpaid bills totalling $100 at the end of August.
5.		Courier charges collected from customers totalled $21,000. In addition, customers still owed $500 for services performed in the last two weeks of August.
6.		After the close of business on August 31, there was a balance of $6,994 in the company’s bank account, plus a “float” of $82 in the car.

Analyze the transactions that affected the business during the summer. (Enter amounts that decrease account balance using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45). Indicate whether it is Revenue or Expense in the last column, in case if there is no effect then select "Not Applicable".)

	Assets						Liabilities								Shareholders' Equity
Trans.	Cash		Accounts Receivable		Car		Accounts Payable		Interest Payable		Note Payable (Parents)		Loan Payble (Car)		Common Shares		Retained Earnings
Investment	$Enter a dollar amount.		$Enter a dollar amount.		$Enter a dollar amount.		$Enter a dollar amount.		$Enter a dollar amount.		$Enter a dollar amount.		$Enter a dollar amount.		$Enter a dollar amount.		$Enter a dollar amount.	Select an option.                                                                       Not ApplicableExpenseDividendRevenue
Par. Loan	Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.	Select an option.                                                                       RevenueExpenseDividendNot Applicable
Purch. Car	Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.	Select an option.                                                                       RevenueNot ApplicableExpenseDividend
1.	Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.	Select an option.                                                                       RevenueNot ApplicableDividendExpense
2.	Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.	Select an option.                                                                       RevenueDividendExpenseNot Applicable
3.	Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.	Select an option.                                                                       ExpenseNot ApplicableRevenueDividend
4.	Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.	Select an option.                                                                       Not ApplicableRevenueExpenseDividend
5.	Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.	Select an option.                                                                       RevenueExpenseDividendNot Applicable
6.	Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.		Enter a dollar amount.	Select an option.                                                                       DividendRevenueNot ApplicableExpense
Total	$Enter a total amount.		$Enter a total amount.		$Enter a total amount.		$Enter a total amount.		$Enter a total amount.		$Enter a total amount.		$Enter a total amount.		$Enter a total amount.		$Enter a total amount.

eTextbook and Media

List of Accounts

Correct answer iconYour answer is correct.Prepare a statement of income for Wroad Wrunner for the four-month period ending on August 31. (Enter loss using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)

Wroad Wrunner Ltd. Statement of Income Choose the accounting period.                                                                       August 31, 2XXXFor the Four Months Ended August 31, 2XXXFor the Year Ended August 31, 2XXX
Select an income statement item.                                                                       Interest Expense – Loan from ParentsExpensesInterest Expense – Car LoanTotal ExpensesDepreciation ExpenseNet Income / (Loss)Operating ExpensesRevenueWages Expense				$Enter a dollar amount.
Select an opening section name.                                                                       Depreciation ExpenseNet Income / (Loss)Wages ExpenseOperating ExpensesRevenueTotal ExpensesInterest Expense – Loan from ParentsInterest Expense – Car LoanExpenses:
Select an income statement item.                                                                       Wages ExpenseTotal ExpensesOperating ExpensesExpensesRevenueDepreciation ExpenseInterest Expense – Loan from ParentsInterest Expense – Car LoanNet Income / (Loss)		$Enter a dollar amount.
Select an income statement item.                                                                       ExpensesDepreciation ExpenseInterest Expense – Car LoanOperating ExpensesTotal ExpensesRevenueWages ExpenseNet Income / (Loss)Interest Expense – Loan from Parents		Enter a dollar amount.
Select an income statement item.                                                                       Depreciation ExpenseTotal ExpensesRevenueExpensesInterest Expense – Car LoanInterest Expense – Loan from ParentsNet Income / (Loss)Operating ExpensesWages Expense		Enter a dollar amount.
Select an income statement item.                                                                       Total ExpensesInterest Expense – Car LoanNet Income / (Loss)ExpensesInterest Expense – Loan from ParentsRevenueOperating ExpensesDepreciation ExpenseWages Expense		Enter a dollar amount.
Select an income statement item.                                                                       RevenueDepreciation ExpenseTotal ExpensesWages ExpenseNet Income / (Loss)Operating ExpensesInterest Expense – Car LoanExpensesInterest Expense – Loan from Parents		Enter a dollar amount.
Select a closing section name.                                                                       Wages ExpenseOperating ExpensesInterest Expense – Car LoanRevenueExpensesTotal ExpensesNet Income / (Loss)Depreciation ExpenseInterest Expense – Loan from Parents				Enter a total amount for this section.
Select closing name for this statement.                                                                       Interest Expense – Car LoanNet Income / (Loss)ExpensesDepreciation ExpenseTotal ExpensesOperating ExpensesInterest Expense – Loan from ParentsRevenueWages Expense				$Enter a total net income or loss amount.

eTextbook and Media

List of Accounts

New attempt is in progress. Some of the new entries may impact the last attempt grading.Your answer is partially correct.Prepare a statement of financial position for Wroad Wrunner on August 31. (List assets in order of liquidity.)

Wroad Wrunner Ltd. Statement of Financial Position Choose the accounting period.                                                                       August 31, 2XXXFor the Four Months Ended August 31, 2XXXFor the Year Ended August 31, 2XXX
Select an opening section name.                                                                       AssetsLiabilitiesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesPlant AssetsShareholder's EquityTotal AssetsTotal LiabilitiesTotal Intangible AssetsTotal Liabilities and Shareholder's EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Plant AssetsTotal Shareholder's Equity
Select a balance sheet item.                                                                       Unearned RentAccounts PayableLoan Payable – CarCommon SharesNotes PayableTaxes Payable/ LiabilitiesPrepaid InsuranceAccounts ReceivableInterest PayableBuildingsRetained EarningsFurniture and EquipmentCashCar		$Enter a dollar amount.
Select a balance sheet item.                                                                       CashPrepaid InsuranceLoan Payable – CarAccounts ReceivableUnearned RentCarCommon SharesAccounts PayableTaxes Payable/ LiabilitiesBuildingsNotes PayableInterest PayableFurniture and EquipmentRetained Earnings		Enter a dollar amount.
Select a balance sheet item.                                                                       Unearned RentTaxes Payable/ LiabilitiesLoan Payable – CarRetained EarningsInterest PayableAccounts PayableBuildingsNotes PayableCommon SharesPrepaid InsuranceCarFurniture and EquipmentAccounts ReceivableCash		Enter a dollar amount.
Select a closing section name for this part of the statement of financial position.                                                                       AssetsLiabilitiesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesPlant AssetsShareholder's EquityTotal AssetsTotal LiabilitiesTotal Intangible AssetsTotal Liabilities and Shareholder's EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Plant AssetsTotal Shareholder's Equity				$Enter a total amount for this part of the statement of financial position.
Select an opening name for section one.                                                                       AssetsLiabilitiesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesPlant AssetsShareholder's EquityTotal AssetsTotal LiabilitiesTotal Intangible AssetsTotal Liabilities and Shareholder's EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Plant AssetsTotal Shareholder's Equity
Select a balance sheet item.                                                                       Prepaid InsuranceCashAccounts ReceivableNotes PayableFurniture and EquipmentLoan Payable – CarCarBuildingsCommon SharesRetained EarningsTaxes Payable/ LiabilitiesInterest PayableAccounts PayableUnearned Rent		$Enter a dollar amount.
Select a balance sheet item.                                                                       Common SharesAccounts PayableFurniture and EquipmentTaxes Payable/ LiabilitiesCarAccounts ReceivableUnearned RentNotes PayablePrepaid InsuranceLoan Payable – CarCashRetained EarningsInterest PayableBuildings		Enter a dollar amount.
Select a balance sheet item.                                                                       Loan Payable – CarCarBuildingsRetained EarningsAccounts ReceivableCommon SharesCashAccounts PayableFurniture and EquipmentNotes PayableUnearned RentInterest PayableTaxes Payable/ LiabilitiesPrepaid Insurance		Enter a dollar amount.
Select a balance sheet item.                                                                       Notes PayableRetained EarningsBuildingsTaxes Payable/ LiabilitiesUnearned RentFurniture and EquipmentLoan Payable – CarAccounts PayableCarCommon SharesInterest PayableAccounts ReceivableCashPrepaid Insurance		Enter a dollar amount.
Select a closing name for section one.                                                                       AssetsLiabilitiesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesPlant AssetsShareholder's EquityTotal AssetsTotal LiabilitiesTotal Intangible AssetsTotal Liabilities and Shareholder's EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Plant AssetsTotal Shareholder's Equity				$Enter a total amount for this section of the statement of financial position.
Select an opening name for section two.                                                                       AssetsLiabilitiesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesPlant AssetsShareholder's EquityTotal AssetsTotal LiabilitiesTotal Intangible AssetsTotal Liabilities and Shareholder's EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Plant AssetsTotal Shareholder's Equity
Select a balance sheet item.                                                                       Notes PayableRetained EarningsUnearned RentCommon SharesFurniture and EquipmentTaxes Payable/ LiabilitiesCarAccounts PayablePrepaid InsuranceInterest PayableLoan Payable – CarBuildingsCashAccounts Receivable		Enter a dollar amount.
Select a balance sheet item.                                                                       Accounts PayableBuildingsUnearned RentCarInterest PayableLoan Payable – CarTaxes Payable/ LiabilitiesCashRetained EarningsAccounts ReceivablePrepaid InsuranceNotes PayableFurniture and EquipmentCommon Shares		Enter a dollar amount.
Select a closing name for section two.                                                                       AssetsLiabilitiesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesPlant AssetsShareholder's EquityTotal AssetsTotal LiabilitiesTotal Intangible AssetsTotal Liabilities and Shareholder's EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Plant AssetsTotal Shareholder's Equity				Enter a total of the two previous amounts.
Select a closing name for this part of the statement of financial position.                                                                       AssetsLiabilitiesIntangible AssetsLong-term InvestmentsLong-term LiabilitiesPlant AssetsShareholder's EquityTotal AssetsTotal LiabilitiesTotal Intangible AssetsTotal Liabilities and Shareholder's EquityTotal Long-term InvestmentsTotal Long-term LiabilitiesTotal Plant AssetsTotal Shareholder's Equity				$Enter a total amount for this part of the statement of financial position.