Chapter 3, Problem 10E

Preparing financial statements from a trial balance P6

Following are the accounts and balances from the adjusted trial balance of Stark Company. Prepare the (1) income statement and (2) statement of owner's equity for the year ended December 31 and (3) balance sheet at December 31. The Stark, Capital account balance was $24_,800 on December 31 of the prior year.
Notes payable......................... $11,000
Prepaid insurance_____................ 2,500
I rrterest expense______................ 500
Accounts payable _____................ 1,500
Wages payable _______................ 400
Cash................................ 10,000
Wages expense....................... 7,500
Insurance expense.................... 1,800
Stark, Capital......................... 54,800
Services revenue...................... 50,000
Accumulated depreciation—Buildings............ $15,000
Accounts receivable....................._____ 4,000
Utilities expense.......................,..... 1,300
Interest payable.......................,..... 100
Unearned revenue........................... 800
Su pplies expense......................,..... 200
Buildings..............................40,000
Stark, Withdrawals........................... 3,000
Depreciation expense—Buildings.........,..... 2,000
Supplies.................................... 800