Prepare statement of retained earnings and a balance sheet.

Question 1 (30 marks, 45 minutes) The following trial balance was taken from the books of Julianna Corporation at December 31, 2020. Account Cash Accounts Receivable Note Receivable Allowance for Doubtful Accounts Merchandise Inventory, Beginning Unexpired Insurance Furniture and Equipment Accumulated Depreciation Accounts Payable Common Shares Retained Earnings, Beginning Sales Purchases Salaries Expense Rent Expense Total Debit (Credit) 200,000 540,000 40,000 (9,000) 270,000 24,000 690,000 (75,000) (54,000) (220,000) (325,000) (2,050,000) 640,000 265,000 64,000 At the end of the year, the following issues were noted: 1. The insurance contract was dated from March 1, 2020 - September 30, 2021. 2. 20,000 preferred shares were issued for $50 / share. The shares pay a $1.50/share cumulative dividend. 3. Estimated bad debts are 1 percent of gross sales. 4. Depreciation on furniture and equipment is 10% per year. 5. Dividends of $30,000 were declared and paid to common shareholders on December 20. Payment will be made in January. 6. An inventory count on December 31, 2020 indicated that the total inventory on hand was $590,000. 7. Interest of 9% is receivable on the note on January 1 each year. The note is due to mature on January 1, 2025. 8. Accrued salaries at December 31, $ 31,000 were not recorded