financial accounting week 3 assignment
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The adjusted trial balance for the year of Corporation at , , follows. Smith May 31 2018
(Click the icon to view the adjusted trial balance.) 1Read the requirements . 2 Requirement 1. Prepare Co
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rporation's single-step income statement, statement of retained earnings, and balance sheet. Smith 2018 Begin by preparing 's income statement. The income statement lists all the revenues together under a heading such as Revenues. The expenses are listed together in a single category titled Expenses. Smith 2018 Smith Corporation
Income Statement Year Ended May 31, 2018 Revenue: Service revenue Expenses:
Salary expense
Rent expense
Insurance expense
Interest expense
Supplies expense
Depreciation expense
Income before tax
Income tax expense Net income Using the trial balance, enter all of the revenue and expense amounts in the income statement columns. Recall that since we are displaying each expense account, we need to subtotal the expenses and put the
subtotal in the same column as the revenue amount. Don't forget to calculate net income.
Smith Corporation
Income Statement Year Ended May 31, 2018 Revenue: Service revenue $ 103,900
Expenses:
Salary expense $ 40,300
Rent expense 10,500
Insurance expense 4,200
Interest expense 2,600
Supplies expense 2,100
Depreciation expense 1,700 61,400
Income before tax 42,500
Income tax expense 6,900 Net income $ 35,600
Prepare the statement of retained earnings. Recall the format of the statement of retained earnings and select the report labels.
Smith Corporation
Statement of Retained Earnings
Year Ended May 31, 2018
Retained earnings, May 31, 2017 Add: Net income Subtotal Less: Dividends Retained earnings, May 31, 2018
Now, using the trial balance provided, enter the adjusted balances for each account. Remember, we prepared the Income Statement first because we use the net income amount in this statement. (Include a subtotal
after the "Add" line of the statement.)
Smith Corporation
Statement of Retained Earnings
Year Ended May 31, 2018
Retained earnings, May 31, 2017 $ 3,000 Add: Net income 35,600 Subtotal 38,600
Less: Dividends (5,000)
Retained earnings, May 31, 2018 $ 33,600
Begin the preparation of the balance sheet by selecting the statement accounts and labels. Remember that the balance sheet presents the assets, liabilities and equity accounts of a business. Select the labels now.
(Do not classify the balance sheet into current and long-term sections.)
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