Financial Statements and Closing Entries
Last Chance Company offers legal consulting advice to prison inmates. Last Chance prepared the end-of-period spreadsheet that follows at June 30, 20Y3, the end of the fiscal year.
| | Last Chance Company |
| | End-of-Period Spreadsheet |
| | For the Year Ended June 30, 20Y3 |
| | Unadjusted | | | Adjusted |
| | Trial Balance | Adjustments | Trial Balance |
| Account Title | Dr. | Cr. | Dr. | Cr. | Dr. | Cr. |
| | | | | | | |
| Cash | 5,100 | | | | 5,100 | |
| Accounts Receivable | 22,750 | | 3,750 | | 26,500 | |
| Prepaid Insurance | 3,600 | | | 1,300 | 2,300 | |
| Supplies | 2,025 | | | 1,500 | 525 | |
| Land | 80,000 | | | | 80,000 | |
| Building | 340,000 | | | | 340,000 | |
| Accum. Depr.Building | | 190,000 | | 3,000 | | 193,000 |
| Equipment | 140,000 | | | | 140,000 | |
| Accum. Depr.Equipment | | 54,450 | | 4,550 | | 59,000 |
| Accounts Payable | | 9,750 | | | | 9,750 |
| Salaries & Wages Payable | | | | 1,900 | | 1,900 |
| Unearned Rent | | 4,500 | 3,000 | | | 1,500 |
| Common Stock | | 90,000 | | | | 90,000 |
| Retained Earnings | | 271,300 | | | | 271,300 |
| Dividends | 20,000 | | | | 20,000 | |
| Fees Earned | | 280,000 | | 3,750 | | 283,750 |
| Rent Revenue | | | | 3,000 | | 3,000 |
| Salaries & Wages Expense | 145,100 | | 1,900 | | 147,000 | |
| Advertising Expense | 86,800 | | | | 86,800 | |
| Utilities Expense | 30,000 | | | | 30,000 | |
| Travel Expense | 18,750 | | | | 18,750 | |
| Depr. Exp.Equipment | | | 4,550 | | 4,550 | |
| Depr. Exp.Building | | | 3,000 | | 3,000 | |
| Supplies Expense | | | 1,500 | | 1,500 | |
| Insurance Expense | | | 1,300 | | 1,300 | |
| Misc. Expense | 5,875 | | | | 5,875 | |
| | 900,000 | 900,000 | 19,000 | 19,000 | 913,200 | 913,200 |
Required:
1. Prepare an income statement for the year ended June 30, 20Y3.
| Last Chance Company |
| Income Statement |
| For the Year Ended June 30, 20Y3 |
| Revenues: | | |
| | $ | |
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| Total revenues | | $ |
| Expenses: | | |
| | $ | |
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| Total expenses | | |
| | | $ |
2. Prepare a statement of stockholders equity for the year ended June 30, 20Y3. During the year ended June 30, 20Y3, additional common stock of $20,000 was issued. If an amount box does not require an entry, leave it blank. If a net loss is incurred or dividends were paid, enter that amount as a negative number using a minus sign.
| Last Chance Company |
| Statement of Stockholders' Equity |
| For the Year Ended June 30, 20Y3 |
| | Common Stock | Retained Earnings | Total |
| | $ | $ | $ |
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| | $ | $ | $ |
3. Prepare a balance sheet as of June 30, 20Y3.
| Last Chance Company |
| Balance Sheet |
| June 30, 20Y3 |
| Assets |
| Current assets: | | | |
| | | $ | |
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| Total current assets | | | $ |
| Property, plant, and equipment: | | | |
| | | $ | |
| | $ | | |
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| | $ | | |
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| Total property, plant, and equipment | | | |
| Total assets | | | $ |
| Liabilities |
| Current liabilities: | | | |
| | | $ | |
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| Total liabilities | | | $ |
| Stockholders' Equity |
| | | $ | |
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| Total stockholders' equity | | | |
| Total liabilities and stockholders' equity | | | $ |
4. On the basis of the end-of-period spreadsheet, journalize the closing entries. If an amount box does not require an entry, leave it blank.
| 20Y3 Jun. 30 | | | |
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| 20Y3 Jun. 30 | | | |
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5. Prepare a post-closing trial balance. List the accounts as: Assets, Liabilities, Capital, Dividends, Revenue and Expenses. If an amount box does not require an entry, leave it blank.
| Last Chance Company |
| Post-Closing Trial Balance |
| June 30, 20Y3 |
| | Debit Balances | Credit Balances |
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