Finders Investigative Services is an investigative services firm that is owned and operated by Stacy Tanner. On June 30, 20Y3, the end of the fiscal year, the accountant for Finders Investigative Services prepared an end-of-period spreadsheet, a part of which follows: Finders Investigative Services End-of-Period Spreadsheet For the Year Ended June 30, 20Y3 ~ Adjusted Trial Balance Account Title ~ Dr. Cr. ~ Cash ~ 28,000 Accounts Receivable ~ 69,600 Supplies ~ 4,600 Prepaid Insurance ~ 2,500 Building ~ 439,500 Accumulated Depreciation-Building ~ 44,200 Accounts Payable ~ 11,700 Salaries Payable ~ 3,000 Unearned Rent ~ 2,000 Stacy Tanner, Capital ~ 373,800 Stacy Tanner, Drawing ~ 12,000 Service Fees ~ 718,000 Rent Revenue ~ 12,000 Salaries Expense ~ 522,100 Rent Expense ~ 48,000 Supplies Expense ~ 10,800 Depreciation Expense-Building ~ 8,750 Utilities Expense ~ 7,150 Repairs Expense ~ 3,000 Insurance Expense ~ 2,500 Miscellaneous Expense ~ 6,200 ~ 1,164,700 1,164,700 Required: 1. Prepare an income statement, a statement of owner’s equity (no additional investments were made during the year), and a balance sheet.* 2. Journalize the entries that were required to close the accounts at June 30.* 3. If Stacy Tanner, Capital has instead decreased $30,000 after the closing entries were posted, and the withdrawals remained the same, what would have been the amount of net income or net loss? *Be sure to read the instructions for each financial statement carefully. CHART OF ACCOUNTS Finders Investigative Services General Ledger ASSETS 11 Cash 12 Accounts Receivable 13 Supplies 14 Prepaid Insurance 16 Building 17 Accumulated Depreciation-Building LIABILITIES 21 Accounts Payable 22 Salaries Payable 23 Unearned Rent EQUITY 31 Stacy Tanner, Capital 32 Stacy Tanner, Drawing 33 Income Summary REVENUE 41 Service Fees 42 Rent Revenue EXPENSES 51 Salaries Expense 52 Rent Expense 53 Supplies Expense 54 Depreciation Expense-Building 55 Utilities Expense 56 Repairs Expense 57 Insurance Expense 59 Miscellaneous Expense Label and amount description Labels Current assets Current liabilities Expenses For the Year Ended June 30, 20Y3 June 30, 20Y3 Property, plant, and equipment Revenues Amount Descriptions Decrease in owner’s equity Increase in owner’s equity Net income Net loss Stacy Tanner, capital, July 1, 20Y2 Stacy Tanner, capital, June 30, 20Y3 Total assets Total current assets Total expenses Total liabilities Total liabilities and owner’s equity Total property, plant, and equipment Total revenues Withdrawals . Prepare an income statement for the year ended June 30, 20Y3. Be sure to complete the statement heading. Refer to the Chart of Accounts and the list of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. Enter amounts as positive numbers unless the amount is a calculation that results in a negative amount. For example: Net loss should be negative. Expenses should be positive. You will not need to enter colons (:) on the income statement. Finders Investigative Services Income Statement (Label) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 1. Prepare a statement of owner’s equity for the year ended June 30, 20Y3. No additional investments were made during the year. Be sure to complete the statement heading. Refer to the list of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. For those boxes in which you must enter subtracted or negative numbers use a minus sign. Finders Investigative Services Statement of Owner’s Equity (Label) 1 2 3 4 5 1. Prepare a balance sheet as of June 30, 20Y3. Fixed assets must be entered in order according to account number. Be sure to complete the statement heading. Refer to the Chart of Accounts and the list of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. You will not need to enter colons (:) or the word "Less" on the balance sheet; they will automatically insert where necessary. Enter all values as positive amounts. Finders Investigative Services Balance Sheet (Label) 1 Assets 2 (label) 3 4 5 6 7 8 (label) 9 10 11 12 13 Liabilities 14 (label) 15 16 17 18 19 Owner’s Equity 20 21 2. Based upon the end-of-period spreadsheet, journalize the closing entries. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered. PAGE 11 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 Closing Entries 2 3 4 5 6 7 8 9 10 11 12 13 14
Finders Investigative Services is an investigative services firm that is owned and operated by Stacy Tanner. On June 30, 20Y3, the end of the fiscal year, the accountant for Finders Investigative Services prepared an end-of-period spreadsheet, a part of which follows: Finders Investigative Services End-of-Period Spreadsheet For the Year Ended June 30, 20Y3 ~ Adjusted Trial Balance Account Title ~ Dr. Cr. ~ Cash ~ 28,000 Accounts Receivable ~ 69,600 Supplies ~ 4,600 Prepaid Insurance ~ 2,500 Building ~ 439,500 Accumulated Depreciation-Building ~ 44,200 Accounts Payable ~ 11,700 Salaries Payable ~ 3,000 Unearned Rent ~ 2,000 Stacy Tanner, Capital ~ 373,800 Stacy Tanner, Drawing ~ 12,000 Service Fees ~ 718,000 Rent Revenue ~ 12,000 Salaries Expense ~ 522,100 Rent Expense ~ 48,000 Supplies Expense ~ 10,800 Depreciation Expense-Building ~ 8,750 Utilities Expense ~ 7,150 Repairs Expense ~ 3,000 Insurance Expense ~ 2,500 Miscellaneous Expense ~ 6,200 ~ 1,164,700 1,164,700 Required: 1. Prepare an income statement, a statement of owner’s equity (no additional investments were made during the year), and a balance sheet.* 2. Journalize the entries that were required to close the accounts at June 30.* 3. If Stacy Tanner, Capital has instead decreased $30,000 after the closing entries were posted, and the withdrawals remained the same, what would have been the amount of net income or net loss? *Be sure to read the instructions for each financial statement carefully. CHART OF ACCOUNTS Finders Investigative Services General Ledger ASSETS 11 Cash 12 Accounts Receivable 13 Supplies 14 Prepaid Insurance 16 Building 17 Accumulated Depreciation-Building LIABILITIES 21 Accounts Payable 22 Salaries Payable 23 Unearned Rent EQUITY 31 Stacy Tanner, Capital 32 Stacy Tanner, Drawing 33 Income Summary REVENUE 41 Service Fees 42 Rent Revenue EXPENSES 51 Salaries Expense 52 Rent Expense 53 Supplies Expense 54 Depreciation Expense-Building 55 Utilities Expense 56 Repairs Expense 57 Insurance Expense 59 Miscellaneous Expense Label and amount description Labels Current assets Current liabilities Expenses For the Year Ended June 30, 20Y3 June 30, 20Y3 Property, plant, and equipment Revenues Amount Descriptions Decrease in owner’s equity Increase in owner’s equity Net income Net loss Stacy Tanner, capital, July 1, 20Y2 Stacy Tanner, capital, June 30, 20Y3 Total assets Total current assets Total expenses Total liabilities Total liabilities and owner’s equity Total property, plant, and equipment Total revenues Withdrawals . Prepare an income statement for the year ended June 30, 20Y3. Be sure to complete the statement heading. Refer to the Chart of Accounts and the list of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. Enter amounts as positive numbers unless the amount is a calculation that results in a negative amount. For example: Net loss should be negative. Expenses should be positive. You will not need to enter colons (:) on the income statement. Finders Investigative Services Income Statement (Label) 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 1. Prepare a statement of owner’s equity for the year ended June 30, 20Y3. No additional investments were made during the year. Be sure to complete the statement heading. Refer to the list of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. For those boxes in which you must enter subtracted or negative numbers use a minus sign. Finders Investigative Services Statement of Owner’s Equity (Label) 1 2 3 4 5 1. Prepare a balance sheet as of June 30, 20Y3. Fixed assets must be entered in order according to account number. Be sure to complete the statement heading. Refer to the Chart of Accounts and the list of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. You will not need to enter colons (:) or the word "Less" on the balance sheet; they will automatically insert where necessary. Enter all values as positive amounts. Finders Investigative Services Balance Sheet (Label) 1 Assets 2 (label) 3 4 5 6 7 8 (label) 9 10 11 12 13 Liabilities 14 (label) 15 16 17 18 19 Owner’s Equity 20 21 2. Based upon the end-of-period spreadsheet, journalize the closing entries. Refer to the chart of accounts for the exact wording of the account titles. CNOW journals do not use lines for journal explanations. Every line on a journal page is used for debit or credit entries. CNOW journals will automatically indent a credit entry when a credit amount is entered. PAGE 11 JOURNAL ACCOUNTING EQUATION DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 Closing Entries 2 3 4 5 6 7 8 9 10 11 12 13 14
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Concept explainers
The Effect Of Prepaid Taxes On Assets And Liabilities
Many businesses estimate tax liability and make payments throughout the year (often quarterly). When a company overestimates its tax liability, this results in the business paying a prepaid tax. Prepaid taxes will be reversed within one year but can result in prepaid assets and liabilities.
Final Accounts
Financial accounting is one of the branches of accounting in which the transactions arising in the business over a particular period are recorded.
Ledger Posting
A ledger is an account that provides information on all the transactions that have taken place during a particular period. It is also known as General Ledger. For example, your bank account statement is a general ledger that gives information about the amount paid/debited or received/ credited from your bank account over some time.
Trial Balance and Final Accounts
In accounting we start with recording transaction with journal entries then we make separate ledger account for each type of transaction. It is very necessary to check and verify that the transaction transferred to ledgers from the journal are accurately recorded or not. Trial balance helps in this. Trial balance helps to check the accuracy of posting the ledger accounts. It helps the accountant to assist in preparing final accounts. It also helps the accountant to check whether all the debits and credits of items are recorded and posted accurately. Like in a balance sheet debit and credit side should be equal, similarly in trial balance debit balance and credit balance should tally.
Adjustment Entries
At the end of every accounting period Adjustment Entries are made in order to adjust the accounts precisely replicate the expenses and revenue of the current period. It is also known as end of period adjustment. It can also be referred as financial reporting that corrects the errors made previously in the accounting period. The basic characteristics of every adjustment entry is that it affects at least one real account and one nominal account.
Question
Finders Investigative Services is an investigative services firm that is owned and operated by Stacy Tanner. On June 30, 20Y3, the end of the fiscal year, the accountant for Finders Investigative Services prepared an end-of-period spreadsheet, a part of which follows:
| Finders Investigative Services | |||
| End-of-Period Spreadsheet | |||
| For the Year Ended June 30, 20Y3 | |||
| ~ | Adjusted |
||
| Account Title | ~ | Dr. | Cr. |
| ~ | |||
| Cash | ~ | 28,000 | |
| ~ | 69,600 | ||
| Supplies | ~ | 4,600 | |
| Prepaid Insurance | ~ | 2,500 | |
| Building | ~ | 439,500 | |
| ~ | 44,200 | ||
| Accounts Payable | ~ | 11,700 | |
| Salaries Payable | ~ | 3,000 | |
| Unearned Rent | ~ | 2,000 | |
| Stacy Tanner, Capital | ~ | 373,800 | |
| Stacy Tanner, Drawing | ~ | 12,000 | |
| Service Fees | ~ | 718,000 | |
| Rent Revenue | ~ | 12,000 | |
| Salaries Expense | ~ | 522,100 | |
| Rent Expense | ~ | 48,000 | |
| Supplies Expense | ~ | 10,800 | |
| Depreciation Expense-Building | ~ | 8,750 | |
| Utilities Expense | ~ | 7,150 | |
| Repairs Expense | ~ | 3,000 | |
| Insurance Expense | ~ | 2,500 | |
| Miscellaneous Expense | ~ | 6,200 | |
| ~ | 1,164,700 | 1,164,700 |
| Required: | |||
| 1. | Prepare an income statement, a statement of owner’s equity (no additional investments were made during the year), and a |
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| 2. | |||
| 3. | If Stacy Tanner, Capital has instead decreased $30,000 after the closing entries were posted, and the withdrawals remained the same, what would have been the amount of net income or net loss?
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| CHART OF ACCOUNTS | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| General Ledger | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Label and amount description
| Labels | |
| Current assets | |
| Current liabilities | |
| Expenses | |
| For the Year Ended June 30, 20Y3 | |
| June 30, 20Y3 | |
| Property, plant, and equipment | |
| Revenues | |
| Amount Descriptions | |
| Decrease in owner’s equity | |
| Increase in owner’s equity | |
| Net income | |
| Net loss | |
| Stacy Tanner, capital, July 1, 20Y2 | |
| Stacy Tanner, capital, June 30, 20Y3 | |
| Total assets | |
| Total current assets | |
| Total expenses | |
| Total liabilities | |
| Total liabilities and owner’s equity | |
| Total property, plant, and equipment | |
| Total revenues | |
| Withdrawals |
. Prepare an income statement for the year ended June 30, 20Y3. Be sure to complete the statement heading. Refer to the Chart of Accounts and the list of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. Enter amounts as positive numbers unless the amount is a calculation that results in a negative amount. For example: Net loss should be negative. Expenses should be positive. You will not need to enter colons (:) on the income statement.
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1. Prepare a statement of owner’s equity for the year ended June 30, 20Y3. No additional investments were made during the year. Be sure to complete the statement heading. Refer to the list of Labels and Amount Descriptions for the exact wording of the answer choices for text entries. For those boxes in which you must enter subtracted or negative numbers use a minus sign.
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PAGE 11
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