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Assignment 1 - Financial Accounting

The document contains sample accounting entries and financial statements for a company called Morning Jacket: - The general journal entries record transactions for accounts receivable, rent expense, supplies expense, depreciation expense, interest expense, salaries and wages expense, and unearned service revenue. - The income statement shows revenues of $9,500 and expenses of $7,270, resulting in net income of $2,230. - The retained earnings statement shows an opening balance of $0, net income of $2,230, drawings of $3,200, and a year-end balance of -$970. - The balance sheet lists total assets of $24,300, total liabilities

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181 views3 pages

Assignment 1 - Financial Accounting

The document contains sample accounting entries and financial statements for a company called Morning Jacket: - The general journal entries record transactions for accounts receivable, rent expense, supplies expense, depreciation expense, interest expense, salaries and wages expense, and unearned service revenue. - The income statement shows revenues of $9,500 and expenses of $7,270, resulting in net income of $2,230. - The retained earnings statement shows an opening balance of $0, net income of $2,230, drawings of $3,200, and a year-end balance of -$970. - The balance sheet lists total assets of $24,300, total liabilities

Uploaded by

Hasan Naji
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Financial Accounting/ Assignment 1/

Adel Issa Hassan

Question 9

Item Net Income Total Assets Total Liabilities Total Owner’s Equity
Incorrect balances $ 35,000 $115,000 $ 45,000 $ 70,000
Effects of:
Depreciation (10,000) (10,000) (10,000)
Wages (7,000) 7,000 (7,000)
Rent 6,000 6,000 6,000
Correct Balances 24,000 111,000 52,000 59,000

Question 10

a) Prepare Journal:

General Journal

Date Account Titles Debit Credit


31 Accounts Receivable 1,000
Dec. Service Revenue 1,000

Rent Expense 700


Prepaid Rent 700

Supplies Expense 550


Supplies 550

Depreciation Expense-Equipment 250


Accumulated Depreciation-Equipment 250

Interest Expense 140


Interest Payable 140

Salaries and Wages Expense 1,270


Salaries and Wages Payable 1,270

Unearned Service Revenue 500


Service Revenue 500
b) Prepare income statement:

MORNING JACKET
Income Statement
For the year ended December 31
Revenue
Services Revenue $ 9,500
Total Revenue 9,500
Expenses
Salaries and Wages Expense 5,130
Rent Expense 1,200
Supplies Expense 550
Depreciation Expense- Equipment 250
Interest Expense 140
Total Expenses (7,270)
Net Income 2,230
Beginning retained earing

Retained earning

MORNING JACKET
Retained Earning
For the year ended December 31
Retained earnings 1 January. Zero
Net income 2,230
Owner's Drawings 3,200
Retained earnings 31 Dec. (970)
Balance sheet

MORNING JACKET
Balance Sheet
As at 31 December
Assets
Current Assets
Cash and Equivalent $ 2,000
Account Receivable 3,800
Supplies 650
Prepaid Rent 1,400
Total Current Assets 7,850
Long-Term Assets
Equipment 18,000
Accumulated depreciation- (1,550)
Equipment
Total Long- Term Assets 16,450
Total Assets 24,300
Labilities and Owner’s Equity

Labilities
Current Labilities
Accounts Payable 2,700
Notes Payable 10,000
Interest Payable 140
Salaries and Wages Payable 1,270
Unearned Service Revenue 3,960
Total Labilities 18,070
Owner’s Equity
Owner's Capital 7,200
Retained Earning (970)
Total Owner’s Equity 6,230
Total Labilities and Owner’s Equity 24,300
.

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