Question
Stacey's Piano Rebuilding Company has been operating for one year. At the start of the second year, its income statement accounts had zero balances and
Stacey's Piano Rebuilding Company has been operating for one year. At the start of the second year, its income statement accounts had zero balances and its balance sheet account balances were as follows:
Cash | $6,900 | Accounts payable | $8,800 |
Accounts receivable | 30,000 | Unearned revenue | 3,540 |
Supplies | 1,540 | Long-term note payable | 47,500 |
Equipment | 10,300 | Common stock | 192 |
Land | 7,600 | Additional paid-in capital | 768 |
Building | 26,300 | Retained earnings | 21,840 |
Rebuilt and delivered five pianos in January to customers who paid $18,600 in cash.
Received a $600 deposit from a customer who wanted her piano rebuilt.
Rented a part of the building to a bicycle repair shop; received $900 for rent in January.
Received $7,400 from customers as payment on their accounts.
Received an electric and gas utility bill for $440 to be paid in February.
Ordered $960 in supplies.
Paid $1,740 on account in January.
Received from the home of Stacey Eddy, the major shareholder, a $960 tool (equipment) to use in the business in exchange for 100 shares of $1 par value stock.
Paid $14,000 in wages to employees who worked in January.
Declared and paid a $2,000 dividend (reduce Retained Earnings and Cash).
Received and paid cash for the supplies in (f).
Paid $320 in interest expense on the long-term note payable.
Required:
Prepare an unadjusted classified income statement for January of the second year (ignore income taxes).
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