Prepare the statement of retained earnings for the month ended January 31. You will need to determine and enter the accounts and balances to prepare the Statement of Retained Earnings. (Round your final answers to the nearest whole dollar amount.)

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Grid Iron Prep Incorporated (GIPI) is a service business incorporated in January of the current year to provide personal training for
athletes aspiring to play college football. The following transactions occurred during the month ended January 31.
a. GIPI issued stock in exchange for $180,000 cash on 1/01.
b. GIPI purchased a gymnasium building and gym equipment on 1/02 for $55,000, 80% of which related to the gymnasium and
20% to the equipment.
c. GIPI paid $500 cash on 1/03 to have the gym equipment refurbished before it could be used.
d. GIPI provided $5,000 in training on 1/04 and expected collection in February.
e. GIPI collected $44,000 cash in training fees on 1/10, of which $39,000 related to January and $5,000 related to February.
f. GIPI paid $25,000 of wages and $8,500 in utilities on 1/30.
g. GIPI will depreciate the gymnasium building using the straight-line method over 10 years with a residual value of $6,000. Gym
equipment will be depreciated using the double-declining-balance method, with an estimated residual value of $2,500 at the
end of its four-year useful life. Record depreciation on 1/31 equal to one-twelfth the yearly amount.
h. GIPI received a bill on 1/31 for $120 for advertising done on 1/31. The bill has not been paid or recorded.
i. GIPI uses the aging method for estimating doubtful accounts and, on 1/31, will record an estimated 3 percent of its under-30-
day-old accounts as not collectible.
J. GIPI's income tax rate is 30%. Assume depreciation for tax is the same amount as depreciation for financial reporting purposes.
General
Requirement
Journal
General
Ledger
Trial Balance
Income
Statement
Statement of
Retained
Earnings
Balance Sheet
Prepare the statement of retained earnings for the month ended January 31. You will need to determine and enter the
accounts and balances to prepare the Statement of Retained Earnings. (Round your final answers to the nearest whole dollar
amount.)
GRID IRON PREP INCORPORATED
Statement of Retained Earnings
For the Month Ended January 31
Balance, January 1
Net Income
Dividends
Balance, January 31
Income Statement
Balance Sheet >
Transcribed Image Text:Grid Iron Prep Incorporated (GIPI) is a service business incorporated in January of the current year to provide personal training for athletes aspiring to play college football. The following transactions occurred during the month ended January 31. a. GIPI issued stock in exchange for $180,000 cash on 1/01. b. GIPI purchased a gymnasium building and gym equipment on 1/02 for $55,000, 80% of which related to the gymnasium and 20% to the equipment. c. GIPI paid $500 cash on 1/03 to have the gym equipment refurbished before it could be used. d. GIPI provided $5,000 in training on 1/04 and expected collection in February. e. GIPI collected $44,000 cash in training fees on 1/10, of which $39,000 related to January and $5,000 related to February. f. GIPI paid $25,000 of wages and $8,500 in utilities on 1/30. g. GIPI will depreciate the gymnasium building using the straight-line method over 10 years with a residual value of $6,000. Gym equipment will be depreciated using the double-declining-balance method, with an estimated residual value of $2,500 at the end of its four-year useful life. Record depreciation on 1/31 equal to one-twelfth the yearly amount. h. GIPI received a bill on 1/31 for $120 for advertising done on 1/31. The bill has not been paid or recorded. i. GIPI uses the aging method for estimating doubtful accounts and, on 1/31, will record an estimated 3 percent of its under-30- day-old accounts as not collectible. J. GIPI's income tax rate is 30%. Assume depreciation for tax is the same amount as depreciation for financial reporting purposes. General Requirement Journal General Ledger Trial Balance Income Statement Statement of Retained Earnings Balance Sheet Prepare the statement of retained earnings for the month ended January 31. You will need to determine and enter the accounts and balances to prepare the Statement of Retained Earnings. (Round your final answers to the nearest whole dollar amount.) GRID IRON PREP INCORPORATED Statement of Retained Earnings For the Month Ended January 31 Balance, January 1 Net Income Dividends Balance, January 31 Income Statement Balance Sheet >
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