Client Corporation Adjusted Trial Balance December 31, 2020

Account	Debit	Credit
Cash	412,789
Accounts Receivable	50,000
Inventory	350,000
Prepaid Insurance	42,000
Short-term Investments	53,000
Plant, Property & Equipment	2,440,000
Accumulated Depreciation		244,000
Right of Use Asset	60,000
Patent	13,500
Accounts Payable		30,000
Income Tax Payable		88,500
Bonds Payable		300,000
Lease Liability		43,355
Discount on Bonds Payable	10,000
Common Stock $1 par		500,000
Paid-In Capital in Excess of Par, Common Stock		1,655,000
Retained Earnings		0
Sales Revenue		8,721,685
Dividends Declared	15,000
Gain on Sale of Short-term Investments		6,750
Cost of Goods Sold	4,675,750
Depreciation Expense	244,000
Income Tax Expense	335,000
Insurance Expense	42,000
Interest Expense	26,500
Salary Expense	2,370,013
Utilities Expense	449,738
Totals	$ 11,589,290	$ 11,589,290

Additional Information:

• This year (2020) was the company's first year of operations.

• Accounts payable relate only to purchases of inventory. All sales were made on account.

• The bonds payable are five-year, 8% bonds that were issued January 1, 2020, for $287,500. The

  discount is being amortized by the straight-line method.

• A two-year insurance policy was acquired on January 1, 2020.

• The short-term investments are all investments in equity securities; cost equals market value.

• Short-term investments that were purchased for $30,000 were sold for cash on December 1.

• Purchases of Property, Plant, and Equipment were paid with cash.

• The Right of Use asset relates to equipment that Client leased on December 31, 2020 on a 5-year

  finance lease.

• The annual lease payment of $16,645 is due on December 31 of each year. The first payment was

  made December 31, 2020.

• As of December 31, 2020, the current portion of the lease liability is $11,442.

  Required:

  Using the trial balance on page and the additional information provided above, prepare the following financial statements for Client Corporation:

  1. An Income Statement for the year ending December 31, 2020. Use the multiple-step format, and be sure to include appropriate per-share disclosures

2. A Statement of Retained Earnings for the year ending December 31, 2020.

3. A classified Balance Sheet as of December 31, 2020.