The amounts of the assets and liabilities of Harada Office Cleaning as of December 31, 2020, and the revenues and expenses of the company for the year ended on December 31, 2020, appear below. The items are listed in alphabetical order.

Accounts Payable$40,000Land$100,000Accounts Receivable50,000Note Payable200,000Building350,000Property Tax Expense10,000Cash25,000Repairs Expense30,000Equipment110,000Salaries Expense280,000Furniture18,000Service Revenue650,000Interest Expense14,000Supplies10,000Interest Payable3,000Utilities Expense25,000Y. Harada, Withdrawals..

71,000

The beginning amount of owner's equity was $200,000. During the year, the owner made no investments.

Required

1. Prepare the income statement of Harada Office Cleaning for the year ended December 31, 2020. List expenses in order from highest to lowest amount.
2. Prepare the statement of owner's equity of the business for the year ended December 31, 2020.
3. Prepare the balance sheet of the business at December 31, 2020.
4. Answer these questions about Harada Office Cleaning:
5. Was the result ofoperationsfor the year a profit or a loss? How much was it?
6. Did the business's owner's equity increase or decrease during the year? How would this affect the business's ability to borrow money from a bank in the future?
7. How much in total economic resources does the company have at December 31, 2020, as it moves into the new year? How much does the company owe? What is the dollar amount of the owner's portion of the business at December 31, 2020?