ACME Pest Control Services (organized as a corporation on September 1, 2003) has completed the accounting cycle for the second year, ended August 31, 2005. ACME Pest Control also has completed a correct trial balance as follows:

Required: 1. Complete the financial statements, as follows:

a. Income statement for the reporting year ended August 31, 2005. Include income tax expense, assuming a 30 percent tax rate. Use the following major captions: Revenues. Expenses, Pretax Income, Income Tax, Net Income, and EPS (list each item under these captions).

b. Balance sheet at the end of the reporting year, August 31, 2005. Include (1) income taxes for the current year in Income Taxes Payable and (2) dividends in Retained Earnings. Use the following captions (list each item under these captions). 2. Give the journal entry to record income taxes for the year (not yet paid).

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ACME PEST CONTROL SERVICES Trial Balance At August 31, 2005 Account Titles Debit Credit Cash 26,000 Accounts receivable 30,800 Supplies inventory 1,300 Service vehicles (company vans) 60,000 Accumulated depreciation, automobiles 20.000 Equipment 14,000 Accumulated depreciation, equipment 4,000 Accounts payable 16,700 Income taxes payable 0 Salaries payable 1.100 Note payable, long term 34,000