Chapter 5, Problem 5.9SE

Use the following information to answer Short Exercises S5-8 and S5-9.

Carissa Communications reported the following figures from its adjusted trial balance for its first year of business, which ended on July 31, 2016:

Cash	$ 4,100
Cost of Goods Sold	$ 18,800
Selling Expenses	1,300
Equipment, net	8,500
Accounts Payable	4,900
Accrued Liabilities	2,000
Common Stock	2,820
Sales Revenue	42,000
Notes Payable, long-term	400
Accounts Receivable	3,400
Merchandise Inventory	1,200
Interest Expense	20
Administrative Expenses	3,100
Sales Discounts	4,300
Sales Returns and Allowances	7,400

Preparing a merchandiser’s statement of retained earnings and balance sheet Requirements

1. Prepare Carissa Communications’s statement of retained earnings for the year ended July 31, 2016. Assume that there were no dividends declared during the year and that the business began on August 1, 2015.

2. Prepare Carissa Communications’s classified balance sheet at July 31, 2016. Use the report format.