Chapter 5 solution on discussion questions

Chapter 5 solution on discussion questions - BUSI1002...

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BUSI1002 Introduction to Accounting Class Discussion Chapter 5 Suggested Solutions for Discussion Questions Ex. 5.2 a. TUTORS FOR RENT, INC. Income Statement For the Year Ended December 31, 2007 Revenues: Tutoring revenue earned $ 96,000 Expenses: Salary expense $ 52,000 Supply expense 1,200 Advertising expense 300 Depreciation expense: equipment 1,000 54,500 Income before taxes $ 41,500 Income taxes expense 11,600 Net income $ 29,900 TUTORS FOR RENT, INC. Statement of Retained Earnings For the Year Ended December 31, 2007 Retained earnings (1/1/05) $ 45,000 Add: Net Income 29,900 Less: Dividends 2,000 Retained earnings (12/31/05) $ 72,900 1
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BUSI1002 Introduction to Accounting Class Discussion Chapter 5 Ex. 5.2 (continued) TUTORS FOR RENT, INC. Balance Sheet December 31, 2007 Assets Cash $ 91,100 Accounts receivable 4,500 Supplies 300 Equipment $ 12,000 Less: Accumulated depreciation: equipment 5,000 7,000 TOTAL ASSETS $ 102,900 Liabilities Accounts payable $ 1,500 Income taxes payable 3,500 TOTAL LIABILITIES $ 5,000 Stockholders' Equity Capital stock $ 25,000 Retained earnings 72,900 TOTAL STOCKHOLDERS' EQUITY
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Chapter 5 solution on discussion questions - BUSI1002...

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