Stacey's Piano Rebuilding Company has been operating for one year. At the start of the second year, its income statement accounts had zero balances and its balance sheet account balances were as follows: Cash Accounts receivable Supplies Equipment Land Building $ 6,500 30,500 1,520 9,900 7,500 27,300 Accounts payable Unearned revenue Long-term note payable Common stock Additional paid-in capital Retained earnings $ 9,600 3,140 47,700 200 800 21,780 a. Rebuilt and delivered five pianos in January to customers who paid $18,900 in cash. b. Received a $510 deposit from a customer who wanted her piano rebuilt. c. Rented a part of the building to a bicycle repair shop; received $870 for rent in January. d. Received $7,800 from customers as payment on their accounts. e. Received an electric and gas utility bill for $470 to be paid in February. f. Ordered $860 in supplies. g. Paid $1,640 on account in January. h. Received from the home of Stacey Eddy, the major shareholder, a $1,000 tool (equipment) to use in the business in exchange for 130 shares of $1 par value stock. i. Paid $14,900 in wages to employees who worked in January. j. Declared and paid a $2,100 dividend (reduce Retained Earnings and Cash). k. Received and paid cash for the supplies in (f).
Stacey's Piano Rebuilding Company has been operating for one year. At the start of the second year, its income statement accounts had zero balances and its balance sheet account balances were as follows: Cash Accounts receivable Supplies Equipment Land Building $ 6,500 30,500 1,520 9,900 7,500 27,300 Accounts payable Unearned revenue Long-term note payable Common stock Additional paid-in capital Retained earnings $ 9,600 3,140 47,700 200 800 21,780 a. Rebuilt and delivered five pianos in January to customers who paid $18,900 in cash. b. Received a $510 deposit from a customer who wanted her piano rebuilt. c. Rented a part of the building to a bicycle repair shop; received $870 for rent in January. d. Received $7,800 from customers as payment on their accounts. e. Received an electric and gas utility bill for $470 to be paid in February. f. Ordered $860 in supplies. g. Paid $1,640 on account in January. h. Received from the home of Stacey Eddy, the major shareholder, a $1,000 tool (equipment) to use in the business in exchange for 130 shares of $1 par value stock. i. Paid $14,900 in wages to employees who worked in January. j. Declared and paid a $2,100 dividend (reduce Retained Earnings and Cash). k. Received and paid cash for the supplies in (f).
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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At the end of the accounting period, a financial statement is prepared by every company, then at that time while preparing the financial statement, the company determines among its total receivable amount how much portion of receivables is collected by the company during that accounting period.
Accounts Receivable
The word “account receivable” means the payment is yet to be made for the work that is already done. Generally, each and every business sells its goods and services either in cash or in credit. So, when the goods are sold on credit account receivable arise which means the company is going to get the payment from its customer to whom the goods are sold on credit. Usually, the credit period may be for a very short period of time and in some rare cases it takes a year.
Question
Transcribed Image Text:Required:
Prepare an unadjusted classified income statement for January of the second year (ignore income taxes).
STACEY'S PIANO REBUILDING COMPANY
Income Statement (unadjusted)
For the Month Ended January 31
Operating revenues:
Rebuilding fees revenue
Total operating revenues
Operating expenses:
Wages expense
Utilities expense
Total operating expenses
Operating income
Other item:
Rent revenue
Net income
$
18,900
18,900
14,900
470
15,370
870
870
Transcribed Image Text:Stacey's Piano Rebuilding Company has been operating for one year. At the start of the second year, its income
statement accounts had zero balances and its balance sheet account balances were as follows:
Cash
Accounts receivable
Supplies
Equipment
Land
Building
$ 6,500
30,500
1,520
9,900
7,500
27,300
Accounts payable
Unearned revenue
Long-term note payable
Common stock
Additional paid-in capital
Retained earnings
9,600
3,140
47,700
200
800
21,780
a. Rebuilt and delivered five pianos in January to customers who paid $18,900 in cash.
b. Received a $510 deposit from a customer who wanted her piano rebuilt.
c. Rented a part of the building to a bicycle repair shop; received $870 for rent in January.
d. Received $7,800 from customers as payment on their accounts.
e. Received an electric and gas utility bill for $470 to be paid in February.
f. Ordered $860 in supplies.
g. Paid $1,640 on account in January.
h. Received from the home of Stacey Eddy, the major shareholder, a $1,000 tool (equipment) to use in the
business in exchange for 130 shares of $1 par value stock.
i. Paid $14,900 in wages to employees who worked in January.
j. Declared and paid a $2,100 dividend (reduce Retained Earnings and Cash).
k. Received and paid cash for the supplies in (f).
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