Prepare the income statement and balance sheet, Financial Accounting

Below is the Trial Balance for Clay Employment Services, year ending December 31, 2011.  Previous period's information were as follows: net receivables, $290,000 and inventory, $82,000.  Total revenues were $350,000 for 2010, 360,000 for 2009, and 295,000 for 2008.


1)  Prepare the income statement, statement of retained earnings, and balance sheet.

2) Calculate the following ratios: current ratio, quick ratio, debt ratio, accounts receivable turnover, and inventory turnover.  Briefly explain your answers.

3)  Calculate the vertical analysis for total current assets.

4)  Calculate the horizontal analysis on total revenues from 2008 thru 2011.

Cash                                                                        198,000

Accounts receivable                                                    300,000

Inventories                                                                 78,000

Prepaid insurance expense                                            4,000

Supplies                                                                      2,000

Furnitures                                                                 100,000

Accumulated depreciation, furnitures                              60,000

Building                                                                      250,000

Accumulated depreciation, building                                140,000

Accounts payable                                                        310,000

Salaries payable                                                           5,000

Unearned service revenue                                           13,000

Notes payable ($12,000 due in the current year)            40,000

Mortgage payable (1/3 is due in the current year)          30,000

Retained earnings                                                    293,000

Dividends                                                                   65000

Service revenue                                                           300,000

Professional fees revenue                                            30,000

Salary expense                                                            170,000

Supplies expense                                                         4,000

Depreciation expense, furnitures                                20,000

Depreciation expense, building                                   11,000

Rent expense                                                               9,000

Interest expense                                                          7,000

Utilities expense                                                          3,000

Posted Date: 4/5/2013 6:31:29 AM | Location : United States

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