Workshop 2 Student Solutions(1)

Workshop 2 Student Solutions(1) - 1 Workshop 2 Student...

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1 Workshop 2 Student Question and Solution PSB1.6 Prepare financial statements . Goodwin Ltd was started on 1 May 2016 with an investment of $60 000 cash. Following are the assets and liabilities of the company on 31 May 2016, and the revenues and expenses for the month of May, its first month of operations. Cash $38 350 Bank loan $40 000 Accounts receivable 14 800 Rent expense 3 800 Equipment 63 000 Repair expense 600 Service revenue 30 000 Office expense 8 200 Advertising expense 2 000 Insurance expense 1 200 Accounts payable 2 700 No further shares were issued in May, but a dividend of $750 in cash was paid. Required Prepare a statement of profit or loss and calculate retained earnings for the month of May and prepare a statement of financial position as at 31 May 2016. PROBLEM SET B 1.6 Goodwin Ltd Statement of profit or loss for the month ended 31 May 2016 $ $ Revenues: Service revenue 30 000 Expenses: Advertising expense
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