Chapter 3: Q5PSB_2 (page 159)
The adjusted trial balance for Speedy Courier as of December 31, 2017, follows.
Debit Credit
Cash . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . \( 58,000
Accounts receivable . 120,000
Interest receivable 7,000
Notes receivable (due in 90 days) . 210,000
Office supplies 22,000
Trucks 134,000
Accumulated depreciation—Trucks . \) 58,000
Equipment . 270,000
Accumulated depreciation—Equipment 200,000
Land . 100,000
Accounts payable . 134,000
Interest payable 20,000
Salaries payable . 28,000
Unearned delivery fees 120,000
Long-term notes payable . 200,000
Common stock . 15,000
Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 110,000
Dividends 50,000
Delivery fees earned 611,800
Interest earned . 34,000
Depreciation expense—Trucks 29,000
Depreciation expense—Equipment . 48,000
Salaries expense 74,000
Wages expense 300,000
Interest expense . 15,000
Office supplies expense . 31,000
Advertising expense . 27,200
Repairs expense—Trucks . 35,600
Totals \(1,530,800 \)1,530,800
Required
1. Use the information in the adjusted trial balance to prepare (a) the income statement for the year endedDecember 31, 2017, (b) the statement of retained earnings for the year ended December 31, 2017, and
(c) the balance sheet as of December 31, 2017.
2. Compute the profit margin for year 2017 (use total revenues as the denominator).
Short Answer
The net profit margin is 13.31%.
Step by step solution
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