E3-14 Preparing an Income Statement LO3-5 At January 1 (beginning of its fiscal year), Conover, Inc., a financial services consulting firm, reported the following account balanoes (in thousands of dollars, except number of shares and par value per share): 294: 1,420 970 $ 2,000 Accounts payable hort-term investments 460 Unearned revenue unts recelvable 3,720 Salaries Payable Supplies Prepaid expenses 200 Short-term note payable 4,920 Common stock ($1 par value 55 1,630 Additional paid-in capital 6,805 Accumulated depreciation-office equipment (430) Retained earnings 2,160 a. Received $10,500 cash for consulting services rendered. b. Issued 10,100 additional shares of common stock at a market price of $125 per share c. Purchased $740 of equipment, paying 25 percent in cash and owing the rest on a short-term note. d. Received $940 from clients for consulting services to be performed in the next year e. Bought $570 of supplies on account. f. Incurred and paid $1,950 in utilities for the current year g. Consulted for clients in the current year for fees totaling $1,720, due from clients in the next year h. Recelved $3,980 from clients paying on their accounts. i. Incurred $6,310 in salaries in the current year, paying $5,450 and owing the rest (to be paid next year). j. Purchased $1,330 in short-term investments and paid $850 for insurance coverage beginning in the next fiscal year k. Received $15 in interest revenue earned in the current year on short-term investments. E3-14 Preparing an Income Statement LO3-5 At January 1 (beginning of its fiscal year), Conover, Inc., a financial services consulting firm, reported the following account balanoes (in thousands of dollars, except number of shares and par value per share): 294: 1,420 970 $ 2,000 Accounts payable hort-term investments 460 Unearned revenue unts recelvable 3,720 Salaries Payable Supplies Prepaid expenses 200 Short-term note payable 4,920 Common stock ($1 par value 55 1,630 Additional paid-in capital 6,805 Accumulated depreciation-office equipment (430) Retained earnings 2,160 a. Received $10,500 cash for consulting services rendered. b. Issued 10,100 additional shares of common stock at a market price of $125 per share c. Purchased $740 of equipment, paying 25 percent in cash and owing the rest on a short-term note. d. Received $940 from clients for consulting services to be performed in the next year e. Bought $570 of supplies on account. f. Incurred and paid $1,950 in utilities for the current year g. Consulted for clients in the current year for fees totaling $1,720, due from clients in the next year h. Recelved $3,980 from clients paying on their accounts. i. Incurred $6,310 in salaries in the current year, paying $5,450 and owing the rest (to be paid next year). j. Purchased $1,330 in short-term investments and paid $850 for insurance coverage beginning in the next fiscal year k. Received $15 in interest revenue earned in the current year on short-term investments
