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C 4 - 2 ( Algo ) From Recording Transactions ( Including Adjusting Journal Entries ) to Preparing Financial Statements and Closing Journal Entries (

C4-2(Algo) From Recording Transactions (Including Adjusting Journal Entries) to Preparing Financial Statements and Closing Journal Entries (Chapters 2,3, and 4)[LO 2-3, LO 3-3, LO 4-1, LO 4-2, LO 4-3, LO 4-4, LO 4-5, LO 4-6]
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Brothers Harry and Herman Hausyerday began operations of their machine shop (H & H Tool, Incorporated) on January 1,2020. The annual reporting period ends December 31. The trial balance on January 1,2021, follows (the amounts are rounded to thousands of dollars to simplify):
Account Titles Debit Credit
Cash $ 2
Accounts Receivable 6
Supplies 13
Land 0
Equipment 64
Accumulated Depreciation $ 5
Software 18
Accumulated Amortization 4
Accounts Payable 4
Notes Payable (short-term)0
Salaries and Wages Payable 0
Interest Payable 0
Income Tax Payable 0
Common Stock 81
Retained Earnings 9
Service Revenue 0
Salaries and Wages Expense 0
Depreciation Expense 0
Amortization Expense 0
Income Tax Expense 0
Interest Expense 0
Supplies Expense 0
Totals $ 103 $ 103
Transactions and events during 2021(summarized in thousands of dollars) follow:
Borrowed $11 cash on March 1 using a short-term note.
Purchased land on March 2 for future building site; paid cash, $8.
Issued additional shares of common stock on April 3 for $27.
Purchased software on July 4, $11 cash.
Received supplies on account on October 5 for future use, $19.
Paid accounts payable on November 6, $12.
Signed a $20 service contract on November 7 to start February 1,2022.
Recorded revenues of $168 on December 8, including $44 on credit and $124 collected in cash.
Recognized salaries and wages expense on December 9, $89 paid in cash.
Collected accounts receivable on December 10, $28.
Data for adjusting journal entries as of December 31:
Unrecorded amortization for the year on software, $4.
Supplies counted on December 31,2021, $12.
Depreciation for the year on the equipment, $5.
Interest of $1 to accrue on notes payable.
Salaries and wages earned but not yet paid or recorded, $13.
Income tax for the year was $7. It will be paid in 2022.
C4-2(Algo) Part 6
Required:
6-a. Prepare an income statement.
6-b. Prepare the statement of retained earnings.
6-c. Prepare the balance sheet.

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