The financial statement columns of the work sheet for Audio Concepts at December 31, 2020, are as follows:

AUDIO CONCEPTS

Work Sheet

For the Year Ended December 31, 2020

Income Statement Balance Sheet

Accounts Debit Credit Debit Credit

Cash 20,000

Accounts Receivable 11,000

Supplies 4,000

Prepaid Insurance 6,000

Audio Equipment 205,000

Accumulated DepreciationAudio Equipment 29,000

Accounts Payable 19,000

Note Payable 70,000

Salaries Payable 3,000

J. Franco, Capital 112,000

J. Franco, Drawing 14,000

Audio Revenue 123,000

Advertising Expense 18,000

Depreciation Expense 12,000

Insurance Expense 3,000

Rent Expense 17,000

Salaries Expense 40,000

Supplies Expense 6,000

Totals 96,000 123,000 260,000 233,000

Net Income 27,000 27,000

123,000 123,000 260,000 260,000

Instructions

REQUIRED:

1. 1. Calculate the balance of J. Franco, Capital that would appear on a balance sheet at December 31, 2020
2. 2. Prepare a classified balance sheet for Audio Concepts at December 31, 2020 assuming the note payable is a long-term liability.

c. Prepare equity and income statements at December 31, 2020 .