HOPE MERCHANDISING

Worksheet
December 31,2019

Unadjusted Trial Balance Adjustments

Debit Credit Debit Credit
Cash 510,000
Accounts Receivable 110,000
Estimated Uncollectible Accounts 10,000 8,900
Prepaid Insurance 35,000 8,000
Office supplies 22,000 16,000
Office Equipment 450,000
Accumulated Depreciation Eqpt 90,000 50,000
Accounts Payable 87,000
Salaries payable 34,000 30,000
Hope , Capital 520,500
Hope, Withdrawal 9,500
Service Income 521,000
Salaries expense 70,000 30,000
Insurance expense 8,000
Office Supplies expense 16,000
Depreciation expense 50,000
Advertising expense 30,000
Rent expense 26,000
Uncollectible Accounts 8,900
Totals 1,262,500 1,262,500 112,900 112,900
NET PROFIT
Totals

Adjusting Entries:
a. Insurance Expense 8,000 c. Salaries Expense
Prepaid Insurance 8,000 Salaries Payable

b. Office Supplies Expense 16,000 d. Depreciation Expense

Office Supplies 16,000 Accumulated Deppreciation - Eqpt.

e,Uncollectible accounts

Required: Prepare the following

1. Income Statement
2. Balance Sheet
3. Statement of Changes in Equity
4. Closing Entries
5. Post closing trial balance
 Income Statement Balance Sheet
Debit Credit Debit Credit
510,000
110,000
18,900
27,000
6,000
450,000
140,000
87,000
64,000
520,500
9,500
521,000 -
100,000
8,000
16,000
50,000
30,000
26,000
8,900
238,900 521,000 1,112,500 830,400
282,100 282,100
521,000 521,000 1,112,500 1,112,500

Salaries Expense 30,000

Salaries Payable 30,000

Depreciation Expense 50,000

Accumulated Deppreciation - Eqpt. 50,000

Uncollectible accounts 8,900

Estimated Uncollectible Accounts 8,900
 HOPE MERCHANDISING
INCOME STATEMENT
December 31,2019

Service Income 521,000

Total Revenue 521,000
Less: Operating Expenses
Salaries expense 100,000
Insurance expense 8,000
Office Supplies expense 16,000
Depreciation expense 50,000
Advertising expense 30,000
Rent expense 26,000
Uncollectible Accounts 8,900 238,900
Net Profit 282,100

HOPE MERCHANDISING
Balance Sheet
As of December 31, 2019
Assets
Current Assets
Cash and Cash Equivalents 510,000
Trade and Other Receivables ( Note1) 91,100
Inventory ( Note 2) 6,000
Prepaid expenses ( Note 3) 27,000
Total Current Assets 634,100
Non-current Assets
Property, Plant and Equipment ( Note 4) 310,000
Total Non-current Assets 310,000
Total Assets 944,100

Total Liabilties and Owner's Equity

Liabilities
Current Liabilties
Trade and other payables ( Note 5 ) 151,000
Total Liabilties 151,000
Owners Equity
Hope , capital 793,100
Total Liabilties and Owner's Equity 944,100
 HOPE MERCHANDISING
Statement of Changes in Equity
December 31,2019
Hope,Capital beginning 520,500
Add: Net Profit 282,100
Total 802,600
Less: Hope Withdrawal 9,500
Hope,Capital End 793,100

ERCHANDISING
lance Sheet
ecember 31, 2019

Note 1 Trade and other Receivables

Accounts Receivable 110,000
Less: Estimated uncollectible Accounts 18,900
Net realizable value 91,100

Note2 Inventory
Office supplies 6,000

Note 3 Prepaid expense

Prepaid insurance 27,000

Note 4 Property Plant and Equipment

Office Equipment 450,000
Accumulated Depreciation Eqpt - 140,000
Net Book Value 310,000

Note 5 Trade and other Payables

Accounts Payable 87,000
Salaries payable 64,000
Total 151,000
1. Close Revenue Account to income summary account
Service Income 521,000
Income Summary 521,000

2. Close Expense Accounts to income summary account

Income Summary 238,900
Salaries expense 100,000
Insurance expense 8,000
Office Supplies expense 16,000
Depreciation expense 50,000
Advertising expense 30,000
Rent expense 26,000
Uncollectible Accounts 8,900

3. Close the net profit to capital account

Income Summary 282,100
Hope,Capital 282,100

4. Close owner's withdrawal to capital account

Hope,capital 9,500
Hope,withdrawal 9,500
 HOPE MERCHANDISING
Post Closing Trial Balance
December 31,2019

Accounts Titles Debit Credit

Cash 510,000
Accounts Receivable 110,000
Estimated Uncollectible Accounts 18,900
Prepaid Insurance 27,000
Office supplies 6,000
Office Equipment 450,000
Accumulated Depreciation Eqpt 140,000
Accounts Payable 87,000
Salaries payable 64,000
Hope , capital 793,100
Totals 1,103,000 1,103,000