C$4-2($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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$[$The following information applies to the questions displayed below.$]$

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 $2022.$

C$4-2($Algo$)$ Part $6$

Required:

$6-$a$.$ Prepare an income statement.

$6-$b$.$ Prepare the statement of retained earnings.

$6-$c$.$ Prepare the balance sheet.