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Chapter_4_B_Problem_Solutions

Chapter_4_B_Problem_Solutions - Prob 4–1B 1 LAST-CHANCE...

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Unformatted text preview: Prob. 4–1B 1. LAST-CHANCE COMPANY Income Statement For the Year Ended November 30, 2008 Revenues: Fees revenue................................................................. $290,700 Rent revenue................................................................. 2,000 Total revenues.......................................................... $292,700 Expenses: Salaries & wages expense.......................................... $147,000 Advertising expense.................................................... 94,800 Utilities expense........................................................... 27,000 Travel expense............................................................. 18,750 Depreciation expense—equipment............................ 5,200 Depreciation expense—building................................ 2,000 Supplies expense......................................................... 1,525 Insurance expense....................................................... 1,450 Miscellaneous expense............................................... 5,875 Total expenses.......................................................... 303,600 Net loss................................................................................. $ 10,900 2. LAST-CHANCE COMPANY Statement of Owner’s Equity For the Year Ended November 30, 2008 Corey Evans, capital, December 1, 2007........................... $318,800 Net loss for the year............................................................ $10,900 Add withdrawals.................................................................. 15,000 Decrease in owner’s equity................................................ 25,900 Corey Evans, capital, November 30, 2008........................ $292,900 Prob. 4–1B Continued 3. LAST-CHANCE COMPANY Balance Sheet November 30, 2008 Assets Liabilities Current assets: Current liabilities: Cash............................................... $ 4,800 Accounts payable............. $9,750 Accounts receivable.................... 19,950 Salaries & wages Prepaid insurance........................ 1,250 payable............................ 2,700 Supplies........................................ 500 Unearned rent.................... 2,500 Total current assets.................. $ 26,500 Total liabilities...................... $ 14,950 Property, plant, and equipment: Land............................................... $ 75,000 Owner’s Equity Building......................................... $205,000 Corey Evans, capital............ 292,900 Less accum. depreciation........... 78,000 127,000 Equipment..................................... $139,000 Less accum. depreciation........... 59,650 79,350 Total property, plant, and equipment................................ 281,350 Total liabilities and Total assets...................................... $307,850 owner’s equity................... $307,850 Prob. 4–1B Continued 4....
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Chapter_4_B_Problem_Solutions - Prob 4–1B 1 LAST-CHANCE...

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