Chapter 1, Problem 1.43AP

Preparing financial statements

Click a Pix Photography works weddings and prom-type parties. The balance of retained earnings was $26,000 at December 31, 2015. At December 31, 2016, the business’s accounting records show these balances:

Insurance Expense	$ 11,000
Cash	40,000
Accounts Payable	6,000
Advertising Expense	3,200
Service Revenue	95,000
Dividends	10,000
Accounts Receivable	$ 12,000
Notes Payable	9,000
Retained Earnings, Dec. 31, 2016	?
Salaries Expense	20,000
Equipment	73,800
Common Stock	34,000

Prepare the following financial statements for Click a Pix Photography for the year ended December 31, 2016:

1. a. Income statement.
2. b. Statement of retained earnings.
3. c. Balance sheet.