Chapter 4: Q10RQ (page 216)
How could a worksheet help in preparing financial statements?
Answer
In the worksheet, income statement balance sheet accounts are reported with the balances. Lastly net income or loss under income statement section is entered into balance sheet.
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For each account listed, identify the category in which it would appear on a classified balance sheet. a. Office Supplies b. Interest Payable c. Retained Earnings d. Copyrights e. Land f. Accumulated Depreciation—Furniture g. Land (held for long-term investment purposes) h. Unearned Revenue i. Notes Payable (due in six years)
What are the steps in the closing process?
Winters Landscape Services accrued \(4,000 of Salaries Expense at December 31. Winters paid the next payroll at January 10 of
\)6,000. This payment included the accrued amount at December 31, plus $2,000 for the first few days of January.
24A. Record the reversing entry.
For each account listed, identify the category that it would appear on a classified balance sheet. Use the following categories: Current Assets; Long-term Investments; Property, Plant, and Equipment; Intangible Assets; Current Liabilities; Long-term Liabilities; and Stockholders’ Equity. If the item does not belong on the classified balance sheet, put an X. a. Land (used in operations) b. Accumulated Depreciation—Equipment c. Common Stock d. Service Revenue e. Investment in Starbucks Corporation (to be held long-term) f. Accounts Receivable g. Equipment h. Buildings i. Notes Payable (due in 10 years) j. Unearned Revenue k. Cash l. Accounts Payable m. Prepaid Rent n. Dividends o. Land (held for investment purposes) p. Depreciation Expense.
Selected accounts for Kebby Photography at December 31, 2018, follow: Salaries Expense 31,800 1,400 2,700 Supplies Expense 7,000 1,500 Depreciation Expense—Building Depreciation Expense—Furniture Dividends 14,000 Service Revenue 33,000 4,500 Retained Earnings 49,000 Requirements 1. Journalize Kebby Photography’s closing entries at December 31, 2018. 2. Determine Kebby Photography’s ending Retained Earnings balance at December 31, 2018.
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