prepare a statement of earnings, statement of changes in equity, statement of financial position

E4-16 Recording Four Adjusting Entries, Completing a Trial Balance, Preparing Financial Statements, and Recording Closing Entries LO4-1, 4-2, 4-4 Cayuga Ltd. prepared the following trial balance at the end of its first year of operations ended December 31. To simplify the case, the amounts glven are in thousands of dollars. Other data not yet recorded at December 31 are as follows: Onadjusted Account Sitten Debit Credit Cash 5.43 Accounts receivable Prepaid insurance 6 Machinery (20-year life, no residual value) 80 Accumulated depreciation Accounts payable Wages payable se taxes payable Contributed capital (4,000 shares) Retained earnings (deficit) Revenues not detailed) Expenses (not detailed) Totals $184 14 $ 16 68 94 37 $184 a Insurance expired during the year. $4 b. Depreciation expense for the year, $4. a. Insurance expired during the year, $4. b. Depreciation expense for the year, $4. c. Wages payable, $9. d. Income tax expense, $14. transaction/event, select "No journal entry required" in the first account field.) Answer is complete and correct. General Journal No Transaction Debit Credit 1 a 4 Insurance expense Prepaid insurance 00 4 > 2 b. 4 Depreciation expenso Accumulated depreciation, machinery 4 3 0. Wages expense Wages payable 9 4 d 14 Income tax expense Income tax payable 14 2. Show the effects of the adjusting entries on net earnings and cash. (Enter your ar there is no effect.) Answer is complete and correct. Transaction a. 4 b. Effect on Net Earnings Decrease by $ Decrease by $ Decrease by $ Decrease by $ 4 Effect on Cash None None None None OOOO C. 9 d. 14 Answer is complete and correct. CAYUGA LTD. Trial Balance As at December 31 (In thousands of dollars) Unadjusted Adjustments Debit Credit Dobit Credit Adjusted Debit Credit Account Titles 43 $ 43 14 6 4 14 2 80 80 $ 8 4 $ 12 14 14 Cash Accounts receivable Prepaid insurance Machinery Accumulated depreciation Accounts payable Wages payable Income taxes payable Contributed capital Retained earnings (deficit) Revenues (not detailed) Expenses (not detailed) Totals 9 9 14 14 68 68 4 4 94 94 37 31 31 68 $ 211 $ 184 $ 184 31 $ 211 4-a. Using the adjusted balances, prepare a statement of earnings. (Enter ya share" to 2 decimal places.) Answer is not complete. CAYUGA LTD. Statement of Earnings For the Year Ended December 31 (In thousands of dollars, except for Earnings per Share) Expenses Earnings before income tax Income tax expense Net earnings Earnings per share 4-b. Using the adjusted balances, prepare a statement of changes in equity. (Enter your answe answers should be indicated by minus sign.) hints Answer is not complete. CAYUGA LTD. Statement of Retained Earnings For the Year Ended December 31 (in thousands of dollars) Balance, January 1 Net earnings Dividends declared Balance, December 31 > $ 0 Statement of Financial Position As at December 31 (In thousands of dollars) Assets > 0 Cash Accounts receivable Prepaid insurance Machinery, at cost Accumulated depreciation Total assets Liabilities Accounts payable Income taxes payable Wages payable $ 0 0 Total liabilities Shareholders' Equity Contributed capital Retained earnings 0 0 Total liabilities and shareholders' equity $