Project #2 Saved Bug-Off Exterminators provides pest control services and sells extermination products manufactured by other companies. The following six-column table contains the company's unadjusted trial balance as of December 31, 2018. 50 points eBook Print Reference BUG-OFF EXTERMINATORS December 31, 2018 Unadjusted Trial Balance Cash $ 16,000 Accounts receivable 5,000 Allowance for doubtful $ 810 accounts Merchandise inventory 10,500 Trucks 30,300 Accum. depreciation-Trucks Equipment 36,000 Accum. depreciation-Equipment 12,400 Accounts payable 4,500 Estimated warranty liability 1,400 Unearned services revenue Interest payable Long-term notes payable 14,500 Common stock 11,000 Retained earnings 49,800 Dividends 17,000 Extermination services revenue 67,000 Interest revenue 879 Sales (of merchandise) 54, 228 Cost of goods sold 45,800 Depreciation expense-Trucks Depreciation expense- Equipment Wages expense Interest expense Rent expense Bad debts expense Miscellaneous expense Repairs expense 6,600 Utilities expense 6,900 Warranty expense Totals 1,217 $216,517 $216,517 The following information in a through h applies to the company at the end of the current year. a. The bank reconciliation as of December 31, 2018, includes the following facts. $ 15, 100 17,000 1,800 2,450 Cash balance per bank Cash balance per books Outstanding checks Deposit in transit Interest earned (on bank account) Bank service charges (miscellaneous expense) Reported on the bank statement is a canceled check that the company failed to record. (Information from the bank reconciliation allows you to determine the amount of this check, which is a payment on an account payable.) b. An examination of customers' accounts shows that accounts totaling $679 should be written off as uncollectible. Using an aging of receivables, the company determines that the ending balance of the Allowance for Doubtful Accounts should be $700. Project #2 Saved c. A truck is purchased and placed in service on January 1, 2018. Its cost is being depreciated with the straight-line method using the following facts and estimates. 50 points Original cost $32,000 Expected salvage value 8,000 Useful life (years) eBook Print d. Two items of equipment (a sprayer and an injector) were purchased and put into service in early January 2016. They are being depreciated with the straight-line method using these facts and estimates. Reference Original cost Expected salvage value Useful life (years) Sprayer Injector $27,000 $18,000 3,000 2,500 8 5 e. On August 1, 2018, the company is paid $3,840 cash in advance to provide monthly service for an apartment complex for one year. The company began providing the services in August. When the cash was received, the full amount was credited to the Extermination Services Revenue account. f. The company offers a warranty for the services it sells. The expected cost of providing warranty service is 2.5% of the extermination services revenue of $64,760 for 2018. No warranty expense has been recorded for 2018. All costs of servicing warranties in 2018 were properly debited to the Estimated Warranty Liability account. g. The $15,000 long-term note is an 8%, five-year, interest-bearing note with interest payable annually on December 31. The note was signed with First National Bank on December 31, 2018. h. The ending inventory of merchandise is counted and determined to have a cost of $11,700. Bug-Off uses a perpetual inventory system. Required: 1. Use the preceding information to determine amounts for the following items. a. Correct (reconciled) ending balance of Cash, and the amount of the omitted check. b. Adjustment needed to obtain the correct ending balance of the Allowance for Doubtful Accounts. c. Depreciation expense for the truck used during year 2018. d. Depreciation expense for the two items of equipment used during year 2018. e. The adjusted 2018 ending balances of the Extermination Services Revenue and Unearned Services Revenue accounts. f. The adjusted 2018 ending balances of the Warranty Expense and the Estimated Warranty Liability accounts. g. The adjusted 2018 ending balances of the Interest Expense and the Interest Payable accounts. 2. Use the results of part 1 to complete the six-column table by first entering the appropriate adjustments for items a through g and then completing the Adjusted Trial Balance columns. (Hint: Item brequires two adjustments.) 3. Prepare journal entries to record the adjustments entered 4n the six-column table. Assume Bug-Off's adjusted balance for Merchandise Inventory matches the year-end physical count. 4-a. Prepare a single-step income statement for year 2018. 4-b. Prepare a statement of retained earnings (cash dividends during 2018 were $10,000) for year 2018. 4-c. Prepare a classified balance sheet as at 2018. Answer is not complete. Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req3 Req 4A Req 4B Req 4C a. Correct (reconciled) ending balance of Cash, and the amount of the omitted check. b. Adjustment needed to obtain the correct ending balance of the Allowance for Doubtful Accounts. c. Depreciation expense for the truck used during year 2018. d. Depreciation expense for the two items of equipment used during year 2018. e. The adjusted 2018 ending balances of the Extermination Services Revenue and Unearned Services Revenue accounts. f. The adjusted 2018 ending balances of the Warranty Expense and the Estimated Warranty Liability accounts. g. The adjusted 2018 ending balances of the Interest Expense and the Interest Payable accounts. (Round amounts to nearest whole dollar.) Show less a. $ 15,750 $ 1,287 $ 551% $ 6,000 $ 3,000 Reconciled balance Omitted check Necessary adjustment Depreciation expense Depreciation- Sprayer Depreciation- Injector Services revenue Unearned services revenue Warranty expense Estimated warranty liability Interest expense Interest payable e . $ 3,100 $ 57,760X $ 2,240 $ 1,444 $ 2,844% g. $ $ Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req3 Req 4A Req 4B Req 40 Use the results of part 1 to complete the six-column table by first entering the appropriate adjustments for items a through g and then completing the Adjusted Trial Balance columns. (Hint: Item b requires two adjustments.) Show less BUG-OFF EXTERMINATORS December 31, 2018 Unadjusted Adjusted Trial Balance Adjustments Trial Balance Account Title Debit Credit Debit Credit Debit Credit Cash $ 16,000 $1,250 $ 15,750X) Accounts receivable 5,000 679 3,321X1 Allowance for $ 810 $ 679 5518 $ 700 doubtful accounts Merchandise 10,500 11,700X inventory Trucks 30.300 32,000x Accum. deprec.- 0 6,000 6,000 Trucks Equipment 36,000 45,000 Accum. deprec.- 12,400 6,100 18,300X Equip Accounts payable 4,500 1,287 3,713X Estim. warranty 1,400 1,444 2,844% liability Unearned services 0 2,240 2,240V rev Interest payable Long-term notes 14,500 15,000 payable Common stock 11,000 10,000x Retained earnings 49,800 49,700 X Dividends 17,000 10,000 Extermination 67,000 2,240 57,760X services revenue Interest revenue 879 52 924X Sales 54,228 71,026X Cost of goods sold 45,800 46,300X Deprec. expense- 0 6,000 6,000 Trucks Deprec. expense- 6,100 6,100 Equip Wages expense 34,000 35,000 X Interest expense Rent expense 7,200 9,000x Bad debts expense 0 5518 551X Miscellaneous 1,217 15 1,241% expense Repairs expense 6,600 8,000X Utilities expense 6.900 6,800X Warranty expense 0 1,444 1,444 Totals 0 0 216,517 216,517 118,316_18,316 238,207238,207 Dan? Complete this question by entering your answers in the tabs below. 50 points Req 1 Req 2 Req3 Req 4A Reg 4B Req 4C Prepare journal entries to record the adjustments entered in the six-column table. Assume Bug-Off's adjusted balance for Merchandise Inventory matches the year-end physical count.(If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Do not round your intermediate calculations.) eBook View transaction list Print Journal entry worksheet References Record the adjustment to the Cash account. Note: Enter debits before credits. General Journal Debit Credit Transaction (a) Accounts payable Interest revenue Cash Record entry Clear entry View general journal Complete this question by entering your answers in the tabs below. 50 points Req 1 Req 2 Req3 Req 4A Reg 4B Req 4C Prepare journal entries to record the adjustments entered in the six-column table. Assume Bug-Off's adjusted balance for Merchandise Inventory matches the year-end physical count.(If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Do not round your intermediate calculations.) eBook View transaction list Print Journal entry worksheet References Record depreciation on the truck. Note: Enter debits before credits. Transaction Debit Credit (c) General Journal Depreciation expense Trucks Accumulated depreciationTrucks Record entry Clear entry View general journal Complete this question by entering your answers in the tabs below. 50 points Req 1 Req 2 Req3 Req 4A Reg 4B Req 4C Prepare journal entries to record the adjustments entered in the six-column table. Assume Bug-Off's adjusted balance for Merchandise Inventory matches the year-end physical count.(If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Do not round your intermediate calculations.) eBook View transaction list Print Journal entry worksheet References Record depreciation on the equipment. Note: Enter debits before credits. Debit Credit Transaction (d) General Journal Depreciation expense-Equipment Accumulated depreciation Equipment Record entry Clear entry View general journal Complete this question by entering your answers in the tabs below. 50 points Req 1 Req 2 Req3 Req 4A Reg 4B Req 4C Prepare journal entries to record the adjustments entered in the six-column table. Assume Bug-Off's adjusted balance for Merchandise Inventory matches the year-end physical count.(If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Do not round your intermediate calculations.) eBook View transaction list Print Journal entry worksheet References Recorded the adjustment for unearned revenues. Note: Enter debits before credits. Transaction Debit Credit General Journal Extermination services revenue Unearned services revenue Record entry Clear entry View general journal Complete this question by entering your answers in the tabs below. 50 points Req 1 Req 2 Req3 Req 4A Reg 4B Req 4C Prepare journal entries to record the adjustments entered in the six-column table. Assume Bug-Off's adjusted balance for Merchandise Inventory matches the year-end physical count.(If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Do not round your intermediate calculations.) eBook View transaction list Print Journal entry worksheet References Record the estimated warranty expense. Note: Enter debits before credits. Transaction Debit Credit General Journal Warranty expense Estimated warranty liability Record entry Clear entry View general journal Complete this question by entering your answers in the tabs below. 50 points Req 1 Req 2 Req3 Req 4A Reg 4B Req 4C Prepare journal entries to record the adjustments entered in the six-column table. Assume Bug-Off's adjusted balance for Merchandise Inventory matches the year-end physical count.(If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Do not round your intermediate calculations.) eBook View transaction list Print Journal entry worksheet References Record the adjustment for interest. Note: Enter debits before credits. Transaction Debit Credit General Journal No journal entry required (9) Record entry Clear entry View general journal X Answer is not complete. Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req 3 Req 4A Req 4B Req 4C Prepare a single-step income statement for year 2018. BUG-OFF EXTERMINATORS Income Statement For Year Ended December 31, 2018 Revenues Extermination services revenue Sales Interest revenue 0 Total revenues Expenses Cost of goods sold Depreciation expense- Trucks Depreciation expense- Equipment Wages expense Rent expense Bad debts expense Miscellaneous expenses Repairs expense Utilities expense Warranty expense sssss Sol Interest expense Total expenses Net income 0 $ X Answer is not complete. Complete this question by entering your answers in the tabs below. Reg 1 Req 2 Req3 Req 4A Req 4B Req 40 Prepare a statement of retained earnings (cash dividends during 2018 were $10,000) for year 2018. BUG-OFF EXTERMINATORS Statement of Retained Earnings For Year Ended December 31, 2018 Retained earnings, December 31, 2017 Add: Net income Less: Dividends Retained earnings, December 31, 2018 0 X Answer is not complete. Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req 3 Req 4A Req 4B Req 4C Prepare a classified balance sheet as at 2018. (Negative amounts should be indicated by a minus sign. Do not round your intermediate calculations.) BUG-OFF EXTERMINATORS Balance Sheet December 31, 2018 Assets Current assets: Cash Accounts receivable Allowance for doubtful accounts Merchandise inventory Total current assets Plant assets: Trucks Accum. depreciation - Trucks Trucks, net Equipment Accum. depreciation- Equipment Equipment, net Total plant assets Total assets Liabilities Current liabilities: Accounts payable Estimated warranty liability Unearned services revenue 10 $ 0 Total current liabilities Long-term liabilities: Long-term notes payable Total liabilities Equity Common stock Retained earnings 0 Total liabilities and equity $ 0 Project #2 Saved Bug-Off Exterminators provides pest control services and sells extermination products manufactured by other companies. The following six-column table contains the company's unadjusted trial balance as of December 31, 2018. 50 points eBook Print Reference BUG-OFF EXTERMINATORS December 31, 2018 Unadjusted Trial Balance Cash $ 16,000 Accounts receivable 5,000 Allowance for doubtful $ 810 accounts Merchandise inventory 10,500 Trucks 30,300 Accum. depreciation-Trucks Equipment 36,000 Accum. depreciation-Equipment 12,400 Accounts payable 4,500 Estimated warranty liability 1,400 Unearned services revenue Interest payable Long-term notes payable 14,500 Common stock 11,000 Retained earnings 49,800 Dividends 17,000 Extermination services revenue 67,000 Interest revenue 879 Sales (of merchandise) 54, 228 Cost of goods sold 45,800 Depreciation expense-Trucks Depreciation expense- Equipment Wages expense Interest expense Rent expense Bad debts expense Miscellaneous expense Repairs expense 6,600 Utilities expense 6,900 Warranty expense Totals 1,217 $216,517 $216,517 The following information in a through h applies to the company at the end of the current year. a. The bank reconciliation as of December 31, 2018, includes the following facts. $ 15, 100 17,000 1,800 2,450 Cash balance per bank Cash balance per books Outstanding checks Deposit in transit Interest earned (on bank account) Bank service charges (miscellaneous expense) Reported on the bank statement is a canceled check that the company failed to record. (Information from the bank reconciliation allows you to determine the amount of this check, which is a payment on an account payable.) b. An examination of customers' accounts shows that accounts totaling $679 should be written off as uncollectible. Using an aging of receivables, the company determines that the ending balance of the Allowance for Doubtful Accounts should be $700. Project #2 Saved c. A truck is purchased and placed in service on January 1, 2018. Its cost is being depreciated with the straight-line method using the following facts and estimates. 50 points Original cost $32,000 Expected salvage value 8,000 Useful life (years) eBook Print d. Two items of equipment (a sprayer and an injector) were purchased and put into service in early January 2016. They are being depreciated with the straight-line method using these facts and estimates. Reference Original cost Expected salvage value Useful life (years) Sprayer Injector $27,000 $18,000 3,000 2,500 8 5 e. On August 1, 2018, the company is paid $3,840 cash in advance to provide monthly service for an apartment complex for one year. The company began providing the services in August. When the cash was received, the full amount was credited to the Extermination Services Revenue account. f. The company offers a warranty for the services it sells. The expected cost of providing warranty service is 2.5% of the extermination services revenue of $64,760 for 2018. No warranty expense has been recorded for 2018. All costs of servicing warranties in 2018 were properly debited to the Estimated Warranty Liability account. g. The $15,000 long-term note is an 8%, five-year, interest-bearing note with interest payable annually on December 31. The note was signed with First National Bank on December 31, 2018. h. The ending inventory of merchandise is counted and determined to have a cost of $11,700. Bug-Off uses a perpetual inventory system. Required: 1. Use the preceding information to determine amounts for the following items. a. Correct (reconciled) ending balance of Cash, and the amount of the omitted check. b. Adjustment needed to obtain the correct ending balance of the Allowance for Doubtful Accounts. c. Depreciation expense for the truck used during year 2018. d. Depreciation expense for the two items of equipment used during year 2018. e. The adjusted 2018 ending balances of the Extermination Services Revenue and Unearned Services Revenue accounts. f. The adjusted 2018 ending balances of the Warranty Expense and the Estimated Warranty Liability accounts. g. The adjusted 2018 ending balances of the Interest Expense and the Interest Payable accounts. 2. Use the results of part 1 to complete the six-column table by first entering the appropriate adjustments for items a through g and then completing the Adjusted Trial Balance columns. (Hint: Item brequires two adjustments.) 3. Prepare journal entries to record the adjustments entered 4n the six-column table. Assume Bug-Off's adjusted balance for Merchandise Inventory matches the year-end physical count. 4-a. Prepare a single-step income statement for year 2018. 4-b. Prepare a statement of retained earnings (cash dividends during 2018 were $10,000) for year 2018. 4-c. Prepare a classified balance sheet as at 2018. Answer is not complete. Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req3 Req 4A Req 4B Req 4C a. Correct (reconciled) ending balance of Cash, and the amount of the omitted check. b. Adjustment needed to obtain the correct ending balance of the Allowance for Doubtful Accounts. c. Depreciation expense for the truck used during year 2018. d. Depreciation expense for the two items of equipment used during year 2018. e. The adjusted 2018 ending balances of the Extermination Services Revenue and Unearned Services Revenue accounts. f. The adjusted 2018 ending balances of the Warranty Expense and the Estimated Warranty Liability accounts. g. The adjusted 2018 ending balances of the Interest Expense and the Interest Payable accounts. (Round amounts to nearest whole dollar.) Show less a. $ 15,750 $ 1,287 $ 551% $ 6,000 $ 3,000 Reconciled balance Omitted check Necessary adjustment Depreciation expense Depreciation- Sprayer Depreciation- Injector Services revenue Unearned services revenue Warranty expense Estimated warranty liability Interest expense Interest payable e . $ 3,100 $ 57,760X $ 2,240 $ 1,444 $ 2,844% g. $ $ Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req3 Req 4A Req 4B Req 40 Use the results of part 1 to complete the six-column table by first entering the appropriate adjustments for items a through g and then completing the Adjusted Trial Balance columns. (Hint: Item b requires two adjustments.) Show less BUG-OFF EXTERMINATORS December 31, 2018 Unadjusted Adjusted Trial Balance Adjustments Trial Balance Account Title Debit Credit Debit Credit Debit Credit Cash $ 16,000 $1,250 $ 15,750X) Accounts receivable 5,000 679 3,321X1 Allowance for $ 810 $ 679 5518 $ 700 doubtful accounts Merchandise 10,500 11,700X inventory Trucks 30.300 32,000x Accum. deprec.- 0 6,000 6,000 Trucks Equipment 36,000 45,000 Accum. deprec.- 12,400 6,100 18,300X Equip Accounts payable 4,500 1,287 3,713X Estim. warranty 1,400 1,444 2,844% liability Unearned services 0 2,240 2,240V rev Interest payable Long-term notes 14,500 15,000 payable Common stock 11,000 10,000x Retained earnings 49,800 49,700 X Dividends 17,000 10,000 Extermination 67,000 2,240 57,760X services revenue Interest revenue 879 52 924X Sales 54,228 71,026X Cost of goods sold 45,800 46,300X Deprec. expense- 0 6,000 6,000 Trucks Deprec. expense- 6,100 6,100 Equip Wages expense 34,000 35,000 X Interest expense Rent expense 7,200 9,000x Bad debts expense 0 5518 551X Miscellaneous 1,217 15 1,241% expense Repairs expense 6,600 8,000X Utilities expense 6.900 6,800X Warranty expense 0 1,444 1,444 Totals 0 0 216,517 216,517 118,316_18,316 238,207238,207 Dan? Complete this question by entering your answers in the tabs below. 50 points Req 1 Req 2 Req3 Req 4A Reg 4B Req 4C Prepare journal entries to record the adjustments entered in the six-column table. Assume Bug-Off's adjusted balance for Merchandise Inventory matches the year-end physical count.(If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Do not round your intermediate calculations.) eBook View transaction list Print Journal entry worksheet References Record the adjustment to the Cash account. Note: Enter debits before credits. General Journal Debit Credit Transaction (a) Accounts payable Interest revenue Cash Record entry Clear entry View general journal Complete this question by entering your answers in the tabs below. 50 points Req 1 Req 2 Req3 Req 4A Reg 4B Req 4C Prepare journal entries to record the adjustments entered in the six-column table. Assume Bug-Off's adjusted balance for Merchandise Inventory matches the year-end physical count.(If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Do not round your intermediate calculations.) eBook View transaction list Print Journal entry worksheet References Record depreciation on the truck. Note: Enter debits before credits. Transaction Debit Credit (c) General Journal Depreciation expense Trucks Accumulated depreciationTrucks Record entry Clear entry View general journal Complete this question by entering your answers in the tabs below. 50 points Req 1 Req 2 Req3 Req 4A Reg 4B Req 4C Prepare journal entries to record the adjustments entered in the six-column table. Assume Bug-Off's adjusted balance for Merchandise Inventory matches the year-end physical count.(If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Do not round your intermediate calculations.) eBook View transaction list Print Journal entry worksheet References Record depreciation on the equipment. Note: Enter debits before credits. Debit Credit Transaction (d) General Journal Depreciation expense-Equipment Accumulated depreciation Equipment Record entry Clear entry View general journal Complete this question by entering your answers in the tabs below. 50 points Req 1 Req 2 Req3 Req 4A Reg 4B Req 4C Prepare journal entries to record the adjustments entered in the six-column table. Assume Bug-Off's adjusted balance for Merchandise Inventory matches the year-end physical count.(If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Do not round your intermediate calculations.) eBook View transaction list Print Journal entry worksheet References Recorded the adjustment for unearned revenues. Note: Enter debits before credits. Transaction Debit Credit General Journal Extermination services revenue Unearned services revenue Record entry Clear entry View general journal Complete this question by entering your answers in the tabs below. 50 points Req 1 Req 2 Req3 Req 4A Reg 4B Req 4C Prepare journal entries to record the adjustments entered in the six-column table. Assume Bug-Off's adjusted balance for Merchandise Inventory matches the year-end physical count.(If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Do not round your intermediate calculations.) eBook View transaction list Print Journal entry worksheet References Record the estimated warranty expense. Note: Enter debits before credits. Transaction Debit Credit General Journal Warranty expense Estimated warranty liability Record entry Clear entry View general journal Complete this question by entering your answers in the tabs below. 50 points Req 1 Req 2 Req3 Req 4A Reg 4B Req 4C Prepare journal entries to record the adjustments entered in the six-column table. Assume Bug-Off's adjusted balance for Merchandise Inventory matches the year-end physical count.(If no entry is required for a particular transaction, select "No journal entry required" in the first account field. Do not round your intermediate calculations.) eBook View transaction list Print Journal entry worksheet References Record the adjustment for interest. Note: Enter debits before credits. Transaction Debit Credit General Journal No journal entry required (9) Record entry Clear entry View general journal X Answer is not complete. Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req 3 Req 4A Req 4B Req 4C Prepare a single-step income statement for year 2018. BUG-OFF EXTERMINATORS Income Statement For Year Ended December 31, 2018 Revenues Extermination services revenue Sales Interest revenue 0 Total revenues Expenses Cost of goods sold Depreciation expense- Trucks Depreciation expense- Equipment Wages expense Rent expense Bad debts expense Miscellaneous expenses Repairs expense Utilities expense Warranty expense sssss Sol Interest expense Total expenses Net income 0 $ X Answer is not complete. Complete this question by entering your answers in the tabs below. Reg 1 Req 2 Req3 Req 4A Req 4B Req 40 Prepare a statement of retained earnings (cash dividends during 2018 were $10,000) for year 2018. BUG-OFF EXTERMINATORS Statement of Retained Earnings For Year Ended December 31, 2018 Retained earnings, December 31, 2017 Add: Net income Less: Dividends Retained earnings, December 31, 2018 0 X Answer is not complete. Complete this question by entering your answers in the tabs below. Req 1 Req 2 Req 3 Req 4A Req 4B Req 4C Prepare a classified balance sheet as at 2018. (Negative amounts should be indicated by a minus sign. Do not round your intermediate calculations.) BUG-OFF EXTERMINATORS Balance Sheet December 31, 2018 Assets Current assets: Cash Accounts receivable Allowance for doubtful accounts Merchandise inventory Total current assets Plant assets: Trucks Accum. depreciation - Trucks Trucks, net Equipment Accum. depreciation- Equipment Equipment, net Total plant assets Total assets Liabilities Current liabilities: Accounts payable Estimated warranty liability Unearned services revenue 10 $ 0 Total current liabilities Long-term liabilities: Long-term notes payable Total liabilities Equity Common stock Retained earnings 0 Total liabilities and equity $ 0