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The Kobe Company was founded on January 1, 2017; since then, the company has been fairly successful; however, in an effort to save some
The Kobe Company was founded on January 1, 2017; since then, the company has been fairly successful; however, in an effort to save some money, the president has been keeping track of the financial records rather than hiring a professional accountant. Although some data is missing, a comparative report of year-end account balances appears below; all numbers are as of December 31st unless noted otherwise. 2019 2020 Payroll expense 184,400 159,200 Common stock 35,000 35,000 Cash 8,900 7,400 Rent expense 34,000 ? Revenues 289,000 264,000 Retained earnings, Jan. 1 ? 14,200 Supplies 480 640 Dividends 2,200 1,800 Notes payable 19,000 20,000 Accounts receivable 12,600 10,800 Retained earnings, Dec. 31 64,300 42,200 Accounts payable 10,200 ? Administrative expenses ? 42,900 Equipment ? 87,760 Required: a. Prepare an income statement, statement of retained earnings and a balance sheet for each year and determine the missing values. b. During January of 2021, the company had the following transactions: Jan. 1 Paid rent of $2,800 for the month Jan. 2 Jan. 3 Purchased $200 of supplies Purchased $4,800 of equipment on account Jan. 6 Sold services to customers for $24,400 Jan. 10 Paid $680 for advertising Jan. 14 Jan. 18 Paid $920 owed to suppliers from purchase on Jan. 3 Paid utility bill of $360 for the month Jan. 24 Made a bank loan payment of $1,200 Jan. 26 Dividend of $550 is paid to the owner Jan. 28 Received $400 from customers on account Jan. 31 Paid employee payroll of $16,800 Jan. 31 Supplies still on hand were reported at $600 Prepare a tabular analysis for January, record the transactions and then prepare a statement of cash flows, income statement, statement of retained earnings and balance for the company.
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