Financial Statements and Closing Entries

Last Chance Company offers legal consulting advice to prison inmates. Last Chance prepared the end-of-period spreadsheet that follows at June 30, 2018, the end of the fiscal year.

NOTE: Can you show how you got the retained earnings in each section? Thanks in avance.

	Last Chance Company
	End-of-Period Spreadsheet
	For the Year Ended June 30, 2018
	Unadjusted						Adjusted
	Trial Balance		Adjustments				Trial Balance
Account Title	Dr.	Cr.		Dr.		Cr.	Dr.	Cr.
Cash	5,100						5,100
Accounts Receivable	22,750		(a)	3,750			26,500
Prepaid Insurance	3,600				(b)	1,300	2,300
Supplies	2,025				(c)	1,500	525
Land	80,000						80,000
Building	340,000						340,000
Accum. Depr.Building		190,000			(d)	3,000		193,000
Equipment	140,000						140,000
Accum. Depr.Equipment		54,450			(e)	4,550		59,000
Accounts Payable		9,750						9,750
Salaries & Wages Payable					(f)	1,900		1,900
Unearned Rent		4,500	(g)	3,000				1,500
Common Stock		90,000						90,000
Retained Earnings		271,300						271,300
Dividends	20,000						20,000
Fees Earned		280,000			(a)	3,750		283,750
Rent Revenue					(g)	3,000		3,000
Salaries & Wages Expense	145,100		(f)	1,900			147,000
Advertising Expense	86,800						86,800
Utilities Expense	30,000						30,000
Travel Expense	18,750						18,750
Depr. Exp.Equipment			(e)	4,550			4,550
Depr. Exp.Building			(d)	3,000			3,000
Supplies Expense			(c)	1,500			1,500
Insurance Expense			(b)	1,300			1,300
Misc. Expense	5,875						5,875
	900,000	900,000		19,000		19,000	913,200	913,200

Required:

1. Prepare an income statement for the year ended June 30.

Last Chance Company
Income Statement
For the Year Ended June 30, 2018
Revenues:
Fees earned	$
Rent revenue
Total revenues		$
Expenses:
Salaries and wages expense	$
Advertising expense
Utilities expense
Travel expense
Depreciation expense-equipment
Depreciation expense-building
Supplies expense
Insurance expense
Miscellaneous expense
Total expenses
Net income		$

2. Prepare a retained earnings statement for the year ended June 30.

Last Chance Company
Retained Earnings Statement
For the Year Ended June 30, 2018
Retained earnings, July 1, 2017		$
Net income	$
Dividends
Change in retained earnings
Retained earnings, June 30, 2018		$

3. Prepare a balance sheet as of June 30.

Last Chance Company
Balance Sheet
June 30, 2018
Assets
Current assets:
Cash		$
Accounts receivable
Prepaid insurance
Supplies
Total current assets			$
Property, plant, and equipment:
Land		$
Building	$
Accumulated depreciation-building
Book value-building
Equipment	$
Accumulated depreciation-equipment
Book value-equipment
Total property, plant, and equipment
Total assets			$
Liabilities
Current liabilities:
Accounts payable		$
Salaries and wages payable
Unearned rent
Total liabilities			$
Stockholders' Equity
Common stock		$
Retained earnings
Total stockholders' equity
Total liabilities and stockholders' equity			$

4. On the basis of the end-of-period spreadsheet, journalize the closing entries. For a compound transaction, if a box does not require an entry, leave it blank.

2018 Jun. 30 Close revenues	Fees Earned
	Rent Revenue
	Income Summary
2018 Jun. 30 Close expenses	Income Summary
	Salaries and Wages Expense
	Advertising Expense
	Utilities Expense
	Travel Expense
	Depreciation Expense-Equipment
	Depreciation Expense-Building
	Supplies Expense
	Insurance Expense
	Miscellaneous Expense
2018 Jun. 30 Close income/loss	Income Summary
	Retained Earnings
2018 Jun. 30 Close dividends	Retained Earnings
	Dividends

5. Prepare a post-closing trial balance. List the accounts as: Assets, Liabilities, Capital, Dividends, Revenue and Expenses. If a box does not require an entry, leave it blank.

Last Chance Company
Post-Closing Trial Balance
June 30, 2018
	Debit Balances	Credit Balances