Question
The adjusted trial balance of Terris Inc. for the year ended September 30, 2019 is as shown below. It is prior to recording of income
The adjusted trial balance of Terris Inc. for the year ended September 30, 2019 is as shown below. It is prior to recording of income tax expense. All accounts are their normal balance (debit or credit). Terris has an income tax rate of 30%.
Accounts payable...................................................................................... $ 80,000
Accounts receivable.................................................................................... 40,000
Cash........................................................................................................ 50,000
Cash dividends declared................................................................................ 7,000
Common shares.......................................................................................... 30,000
Cost of goods sold...................................................................................... 175,000
Dividends payable....................................................................................... 4,000
Interest expense.......................................................................................... 4,500
Inventory................................................................................................ 120,000
Operating expenses..................................................................................... 92,300
Preferred shares......................................................................................... 25,000
Retained earnings, beginning balance............................................................. 11,900
Sales revenue........................................................................................... 320,000
Taxes payable............................................................................................... 100
Instructions:
Prepare the income statement and statement of retained earnings for Terris Inc. for the year ended September 30, 2019.
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