Financial statements and closing entries

The Gorman Group is a financial planning services firm owned and operated by Nicole Gorman. As of October 31, 20Y9, the end of the fiscal year, the accountant for The Gorman Group prepared an end-of-period spreadsheet, part of which follows:

Account Title	Adjusted Trial Balance Dr.	Adjusted Trial Balance Cr.
Cash	13,670
Accounts Receivable	29,760
Supplies	4,650
Prepaid Insurance	10,040
Land	106,000
Buildings	380,000
Accumulated Depreciation-Buildings		123,900
Equipment	275,000
Accumulated Depreciation-Equipment		161,400
Accounts Payable		35,200
Salaries Payable		3,490
Unearned Rent		1,580
Nicole Gorman, Capital		451,780
Nicole Gorman, Drawing	26,400
Service Fees		501,970
Rent Revenue		5,300
Salaries Expense	359,860
Depreciation Expense-Equipment	19,500
Rent Expense	16,400
Supplies Expense	11,580
Utilities Expense	10,460
Depreciation Expense-Buildings	6,980
Repairs Expense	5,770
Insurance Expense	3,160
Miscellaneous Expense	5,390
Total	1,284,620	1,284,620

Required:

1. Prepare an income statement.

Line Item Description	Amount	Amount
Revenues:
Insurance expenseMiscellaneous expenseNicole Gorman, CapitalService feesSupplies expense	$fill in the blank 2
Rent expenseRent revenueRepairs expenseUnearned rentUtilities expense	fill in the blank 4
Total revenues		$fill in the blank 5
Expenses:
BuildingsCashRent revenueSalaries expenseSalaries payable	$fill in the blank 7
Accumulated depreciation-equipmentDepreciation expense-equipmentEquipmentLandNicole Gorman, Capital	fill in the blank 9
Accounts payableRent expenseRent revenueService feesUnearned rent	fill in the blank 11
Accounts receivableNicole Gorman, CapitalRent revenueSuppliesSupplies expense	fill in the blank 13
Nicole Gorman, CapitalRent revenueService feesUnearned rentUtilities expense	fill in the blank 15
Accumulated depreciation-buildingsBuildingsDepreciation expense-buildingsEquipmentLand	fill in the blank 17
Accounts payableNicole Gorman, CapitalRent revenueRepairs expenseSalaries payable	fill in the blank 19
Accounts receivableCashInsurance expensePrepaid insuranceRent revenue	fill in the blank 21
Accumulated depreciation-buildingsBuildingsMiscellaneous expenseService feesUnearned rent	fill in the blank 23
Total expenses		fill in the blank 24
Net incomeNet loss		$fill in the blank 26

Prepare a statement of owners equity. During the year, Nicole Gorman made no additional investments in the business. If an amount box does not require an entry, leave it blank. If a Net loss is incurred or Nicole Gorman, Drawing were paid, enter that amount as a negative number using a minus sign.

Line Item Description	Total
Net income for the yearNet loss for the yearNicole Gorman, capital, November 1, 20Y8Nicole Gorman, capital, October 31, 20Y9Withdrawals	$fill in the blank 28
Change in Nicole Gorman, CapitalNet income for the yearNet loss for the yearNicole Gorman, capital, November 1, 20Y8Nicole Gorman, capital, October 31, 20Y9	fill in the blank 30
Net income for the yearNet loss for the yearNicole Gorman, capital, November 1, 20Y8Nicole Gorman, capital, October 31, 20Y9Withdrawals	fill in the blank 32
Net income for the yearNet loss for the yearNicole Gorman, capital, November 1, 20Y8Nicole Gorman, capital, October 31, 20Y9Withdrawals	$fill in the blank 34

Prepare a balance sheet.

Assets
Current assets:
Accounts payableCashNicole Gorman, capitalSalaries payableUnearned rent		$fill in the blank 36
Accounts payableAccounts receivableNicole Gorman, capitalSalaries payableUnearned rent		fill in the blank 38
Nicole Gorman, capitalSuppliesSupplies expenseUtilities expense		fill in the blank 40
Accumulated depreciation-buildingsEquipmentInsurance expensePrepaid insuranceUnearned rent		fill in the blank 42
Total current assets			$fill in the blank 43
Property, plant, and equipment:
Accounts receivableCashLandService feesSupplies		$fill in the blank 45
Accounts payableAccumulated depreciation-buildingsBuildingsDepreciation expense-buildingsNicole Gorman, capital	$fill in the blank 47
Accounts payableAccumulated depreciation-buildingsCashDepreciation expenseNicole Gorman, capital	fill in the blank 49
Accounts payableBook value-buildingsCashDepreciation expenseNicole Gorman, capital		fill in the blank 51
Accounts payableDepreciation expense-equipmentEquipmentNicole Gorman, capitalUnearned rent	$fill in the blank 53
Accounts payableAccumulated depreciation-equipmentCashDepreciation expensePrepaid insurance	fill in the blank 55
Accounts payableBook value-equipmentCashDepreciation expensePrepaid insurance		fill in the blank 57
Total property, plant, and equipment			fill in the blank 58
Total assets			$fill in the blank 59
Liabilities
Current liabilities:
Accounts payableAccounts receivableBuildingsNicole Gorman, capitalPrepaid insurance		$fill in the blank 61
Accounts receivableRent revenueRepairs expenseSalaries expenseSalaries payable		fill in the blank 63
Accounts receivableAccumulated depreciation-buildingsPrepaid rentRent revenueUnearned rent		fill in the blank 65
Total liabilities			$fill in the blank 66
Owners Equity
CashLandNicole Gorman, capitalService feesSupplies			fill in the blank 68
Total liabilities and owners equity			$fill in the blank 69

2. Journalize the entries that were required to close the accounts at October 31. If an amount box does not require an entry, leave it blank.

Date	Account	Debit	Credit
20Y9 Oct. 31	Insurance expenseMiscellaneous expenseNicole Gorman, CapitalService feesUtilities expense	fill in the blank 71	fill in the blank 72
	CashInsurance expensePrepaid insuranceRent revenueRepairs expense	fill in the blank 74	fill in the blank 75
	Accounts receivableCashNicole Gorman, DrawingSalaries expenseSalaries payable	fill in the blank 77	fill in the blank 78
	Accumulated depreciation-equipmentDepreciation expense-equipmentEquipmentLandService fees	fill in the blank 80	fill in the blank 81
	Accounts receivableNicole Gorman, CapitalRent expenseRent revenueUnearned rent	fill in the blank 83	fill in the blank 84
	CashNicole Gorman, DrawingService feesSuppliesSupplies expense	fill in the blank 86	fill in the blank 87
	BuildingsNicole Gorman, CapitalNicole Gorman, DrawingRent revenueUtilities expense	fill in the blank 89	fill in the blank 90
	Accounts receivableAccumulated depreciation-equipmentBuildingsDepreciation expense-buildingsLand	fill in the blank 92	fill in the blank 93
	Accounts payableEquipmentLandPrepaid insuranceRepairs expense	fill in the blank 95	fill in the blank 96
	Accounts receivableCashInsurance expenseNicole Gorman, CapitalPrepaid insurance	fill in the blank 98	fill in the blank 99
	Accounts receivableCashEquipmentMiscellaneous expenseSalaries payable	fill in the blank 101	fill in the blank 102
	CashNicole Gorman, CapitalService feesUnearned rentWages Payable	fill in the blank 104	fill in the blank 105
20Y9 Oct. 31	Accounts payableNicole Gorman, CapitalNicole Gorman, DrawingRent revenueService fees	fill in the blank 107	fill in the blank 108
	Accounts receivableCashNicole Gorman, CapitalNicole Gorman, DrawingSupplies expense	fill in the blank 110	fill in the blank 111

3. If the balance of Nicole Gorman, Capital had instead increased $37,000 after the closing entries were posted, and the owners withdrawals remained the same, what would have been the amount of Net income or Net loss? Enter all amounts as positive numbers. fill in the blank 1 of 2$ fill in the blank 2 of 2

Net IncomeNet Loss