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Activity 06 - Financial Statement Preparation

The document provides financial statements for Warlito Blanche Graphic Arts for the year ending December 31, 2020 including an income statement, statement of changes in equity, and statement of financial position. The income statement shows revenues of $1,437,500 and expenses of $1,222,800 resulting in net income of $214,700. The statement of changes in equity indicates the owner's capital increased by $141,100. The statement of financial position lists total assets of $939,400 including accounts receivable and land, and total liabilities of $747,800 including accounts payable and notes payable.

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945 views4 pages

Activity 06 - Financial Statement Preparation

The document provides financial statements for Warlito Blanche Graphic Arts for the year ending December 31, 2020 including an income statement, statement of changes in equity, and statement of financial position. The income statement shows revenues of $1,437,500 and expenses of $1,222,800 resulting in net income of $214,700. The statement of changes in equity indicates the owner's capital increased by $141,100. The statement of financial position lists total assets of $939,400 including accounts receivable and land, and total liabilities of $747,800 including accounts payable and notes payable.

Uploaded by

Mariz Tiu
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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TOPIC: UNDERSTANDING FINANCIAL STATEMENTS

 
Activity No. 06 - Financial Statement Preparation 
 
Instruction:  Prepare the following
1. Income Statement
2. Statement of Changes in Equity
3. Statement of Financial Position

using the following accounts of Warlito Blanche Graphic Arts: 


Accounts Payable  122,500 Land  120,000 
Accounts Receivable  219,000 Miscellaneous Expense  24,600 
Accumulated Depreciation- 60,000 Mortgage Payable  395,000 
Building 
Accumulated Depreciation- 60,000 Notes Payable  213,000 
Equipment 
Advertising Expense  105,000 Office Supplies  17,200 
Art Revenues  1,437,500 Blanche, Capital (1/1/2020)  50,500 
Building  450,000 Blanche, Withdrawals  148,600 
Cash  36,200 Representation Expense  164,000 
Depreciation Expense  60,000 Salaries Expense  673,200 
Equipment  217,000 Salaries Payable  17,300 
Interest Expense  37,000 Travel Expense  159,000 

During the year, Blanche invested additional P75,000 in the business. 


 
 
 
 
 
 
Warlito Blanche Graphic Arts
Income Statement
December 31, 2020

Revenues
Art Revenues 1,437,500 
1,437,500 

Expenses
Advertising Expense  105,000 
Depreciation Expense  60,000 
Interest Expense  37,000
Miscellaneous Expense  24,600 
Representation Expense  164,000 
Salaries Expense  673,200 
Travel Expense  159,000 

Total expenses 1,222,800

Net Income 214,700


Warlito Blanche Graphic Arts
Statement of Changes in Equity
For the year ended December 31, 2020

Blanche, Capital (1/1/2020)  50,500


Additional investment during the year 75,000
Net income for the year 214,700
Total 289,700
Less: Withdrawals (148,600)

Net increase in owner’s equity 141,100

Blanche, Capital, December 31 191,600


Warlito Blanche Graphic Arts
Statement of Financial Position
December 31, 2020

ASSETS
Accounts Receivable  219,000
Building 450,000
Accumulated Depreciation-Building  (60,000)
Cash 36,200
Equipment  217,000
Accumulated Depreciation-Equipment (60,000)
Land 120,000
Office Supplies  17,200
Total Assets 939,400

LIABILITIES
Accounts Payable 122,500
Mortgage Payable 395,000
Notes Payable 213,000
Salaries Payable 17,300
Total Liabilities 747,800

OWNER’S EQUITY
Blanche, Capital, December 31 191,600

Total Liabilities and Owner’s Equity 939,400

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