Prepare an income statement, a statement of owner''s equity

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Reference no: EM13982870

The Ultra Services Company is a financial planning services firm owned and operated by Chad Tillman. As of July 31, 2008, the end of the current fiscal year, the accountant for The Ultra Services Company prepared an end-of-period spreadsheet (work sheet), part of which is shown at the top of the next page.

Instructions

1. Prepare an income statement, a statement of owner's equity (no additional investments were made during the year), and a balance sheet.

2. Journalize the entries that were required to close the accounts at July 31.

3. If the balance of Chad Tillman, Capital decreased $40,000 after the closing entries were posted, and the withdrawals remained the same, what was the amount of net income or net loss?

The Ultra Services Company End-of-Period Spreadsheet (Work Sheet)

For the Year Ended July 31, 2008

 

Income Statement

Balance Sheet

Cash

 

 

13,950

 

Accounts Receivable

 

 

41,880

 

Supplies

 

 

8,400

 

Prepaid Insurance

 

 

7,500

 

Land

 

 

180,000

 

Buildings

 

 

360,000

 

Accumulated Depreciation-Buildings

 

 

 

217,200

Equipment

 

 

258,270

 

Accumulated Depreciation-Equipment

 

 

 

122,700

Accounts Payable

 

 

 

33,300

Salaries Payable

 

 

 

3,300

Unearned Rent

 

 

 

1,500

Chad Tillman, Capital

 

 

 

340,500

Chad Tillman, Drawing

 

 

30,000

 

Service Fees

 

525,000

 

 

Rent Revenue

 

4,500

 

 

Salary Expense

219,000

 

 

 

Depreciation Expense-Equipment

28,500

 

 

 

Rent Expense

 

25,500

 

 

 

Supplies Expense

 

22,950

 

 

 

Utilities Expense

 

15,900

 

 

 

Depreciation Expense-Buildings

15,600

 

 

 

Repairs Expense

 

12,450

 

 

 

Insurance Expense

 

3,000

 

 

 

Miscellaneous Expense

 

5,100

 

 

 

 

 

348,000

529,500

900,000

718,500

Net income

 

181,500

   

181,500

 

 

529,500

529,500

900,000

900,000

Reference no: EM13982870

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