Problem 2 the account balances of Midway Corporation for the fiscal year ended in March 31 before adjustments were shown below Debit balances Cash 77,000 Interest Expense 8,500 SSS contribution expense 3,400 Sales Discount 3,350 Accounts Receivable 127,400 Utilities expense 18,950 Selling expense 10,800 Merchandise Inventory 903,200 Salaries Expense 47, 150 Store Equipment 71,000 Supplies Inventory 17, 450 Prepaid Insurance 13,550 Credit Balances Accumulated Depreciation Store Equipment 10,650 Notes Payable 80,000 Accounts Payable 89,000 Common Stock 100,000 Retained Earnings 34,000 Sales 989,000

Data for Adjustments

a. Cost of merchandise sold , 593,900

b. Store equipment is useful life is 10 years. An this equipment was acquired 18 months ago

c. Supplies Inventory on March 31 was 4,300

d. The notes payable was at an interest rate of 10% annually, it had been unpaid throughout the year

e. Expired insurance was 6,500

f. unpaid salaries was 1900

g. the statement sent by banks adjusted for checks outstanding showed a balance of 76,900. The difference is the bank service charge.

Required Prepare an income statement and balance sheet as of March 31