prepare the balance sheet and financial statements, Financial Accounting

The assets and liabilities of Toronto Service Inc. as of December 31, 2008, and revenue and expenses for the year ended December 31, 2008 are listed below:

Accounts Payable

$21,000

 

Property tax expense

$5,000

Accounts Receivable

25,000

 

Rent expense

3,000

Advertising expense

10,000

 

Salary expense

85,000

Building

140,000

 

Salary payable

12,000

Cash

10,000

 

Service Revenue

200,000

Furniture

20,000

 

Share Capital

75,000

Interest expense

4,000

 

Supplies

3,000

Land

98,000

 

Note Payable

95,000

Beginning Retained Earnings were $50,000 and dividends totalled $50,000 for the year.

Required:

a.    Prepare the Income Statement for the year ended December 31, 2008

b.    Prepare the Statement of Retained Earnings for the year

c.    Prepare the Balance Sheet at December 31, 2008

d.    Based on the financial statements prepared, answer the following questions:

1.    Was Toronto Service Inc. profitable during 2008? If so by how much?

2.    Did Retained Earnings increase or decrease? What is the amount of the change?

3.    Which is the greater total, liabilities or total equity? Who owns more of the company's assets, the creditors or the shareholders?

Posted Date: 4/1/2013 6:02:38 AM | Location : United States







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