EXERCISE 4.

TAI INTERIORS
(Partial) Worksheet
For the Month Ended April 30, 2020

Statement of
Adjusted Income Financial
Trial Balance Statement Position
Account Titles Dr. Cr. Dr. Cr. Dr. Cr.
Cash 10,000 10,000
Accounts Receivable 7,840 7,840
Prepaid Rent 2,280 2,280
Equipment 23,050 23,050
Accum. Depreciation
— Equipment 4,900 4,900
Notes Payable 5,700 5,700
Accounts Payable 4,920 4,920
Owner’s Capital 27,960 27,960
Owner’s Drawings 3,650 3,650
Service Revenue 15,590 15,590
Salaries and Wages
Expense 10,840 10,840
Rent Expense 760 760
Depreciation Expense 650 650
Interest Expense 57 57
Interest Payable 57 57
Totals 59,127 59,127 12,307 15,590 46,820 43,537
Net Income 3,283 3,283
Totals 15,590 15,590 46,820 46,820
EXERCISE 4.8

(a)
General Journal J15
Date Account Titles Ref. Debit Credit
July 31 Service Revenue.................................. 400 64,000
Rent Revenue....................................... 429 6,500
Income Summary........................ 350 70,500

31 Income Summary................................. 350 78,600

Salaries and Wages Expense.... 726 55,700
Utilities Expense......................... 732 14,900
Depreciation Expense................ 711 8,000

31 Owner’s Capital.................................... 301 8,100

Income Summary........................ 350 8,100

31 Owner’s Capital.................................... 301 16,000

Owner’s Drawings...................... 306 16,000

(b)

Owner’s Capital No. 301

Date Explanation Ref. Debit Credit Balance
July 31 Balance ✓ 45,200
31 Close net loss J15 8,100 37,100
31 Close drawing J15 16,000 21,100

Income Summary No. 350

Date Explanation Ref. Debit Credit Balance
July 31 Close revenue J15 70,500 70,500
31 Close expenses J15 78,600 (8,100)
31 Close net loss J15 8,100 0
EXERCISE 4.8 (Continued)

(c) HUANG AUTOMOTIVE

Post-Closing Trial Balance
July 31, 2020

Debit Credit
Cash......................................................................
NT$9,840
Accounts Receivable.......................................... 8,780
Equipment............................................................
15,900
Accumulated Depreciation—Equipment........... NT$ 7,400
Accounts Payable................................................ 4,220
Unearned Rent Revenue..................................... 1,800
Owner’s Capital................................................... __ _ ___ 21,100
NT$34,520 NT$34,520
EXERCISE 4.17

(a)
BASTEN TAX SERVICES
Income Statement
For the Year Ended July 31, 2020

Revenues
Service revenue........................................ £63,000
Rent revenue............................................ 8,500
Total revenues.................................. £71,500
Expenses
Salaries and wages expense................... 48,700
Utilities expense....................................... 22,600
Depreciation expense.............................. 4,000
Total expense.................................... 75,300
Net loss............................................................. £ (3,800)

BASTEN TAX SERVICES

Owner’s Equity Statement
For the Year Ended July 31, 2020

Owner’s Capital, August 1, 2019.................... £51,200

Less: Net loss.................................................. £3,800
Drawings................................................ 3,000 6,800
Owner’s Capital, July 31, 2020........................ £44,400
EXERCISE 4.17 (Continued)

(b)
BASTEN TAX SERVICES
Statement of Financial Position
July 31, 2020

Assets
Property, plant, and equipment
Equipment........................................................ £34,400
Less: Accumulated depreciation—
equipment............................................. 6,000 £28,400
Current assets
Accounts receivable....................................... 9,780
Cash................................................................. 14,200
Total current assets................................ 23,980
Total assets ............................................. £52,380

Owner’s Equity and Liabilities

Owner’s Equity
Owner’s capital................................................ £44,400
Non-current liabilities
Notes payable.................................................. £1,800
Current liabilities
Accounts payable................................... £4,100
Salaries and wages payable.................. 2,080
Total current liabilities............................ 6,180
Total liabilities......................................... 7,980
Total owner’s equity and liabilities ....... £52,380
4-34

(a) WANG ROOFING

Worksheet
Copyright

For the Month Ended March 31, 2020

Adjusted Income Statement of
© Account Titles Trial Balance Adjustments Trial Balance Statement Financial
Position
2018 WILEY

Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr.
Cash 4,500 4,500 4,500
Accounts Receivable 3,200 3,200 3,200
Supplies 2,000 (a) 1,520 480 480
Weygandt, Accounting Principles, IFRS 1/e, Solutions Manual

Equipment 11,000 11,000 11,000

Accumulated
Depreciation—Equipment 1,250 (b) 250 1,500 1,500
Accounts Payable 2,500 2,500 2,500
Unearned Service Revenue 550 (c) 290 260 260
Owner’s Capital 12,900 12,900 12,900
Owner’s Drawings 1,100 1,100 1,100
Service Revenue 6,300 (c) 290 6,590 6,590
Salaries and Wages
Expense 1,300 (d) 700 2,000 2,000
Miscellaneous Expense 400 400 400
Totals 23,500 23,500
Supplies Expense (a) 1,520 1,520 1,520
Depreciation Expense (b) 250 250 250
Salaries and Wages
Payable (d) 700 700 700
Totals 2,760 2,760 24,450 24,450 4,170 6,590 20,280 17,860
Net Income 2,420 2,420
Totals 6,590 6,590 20,280 20,280
(For Instructor Use Only)

Key: (a) Supplies Used; (b) Depreciation Expensed; (c) Service Revenue Recognized; (d) Salaries Accrued.

PROBLEM 4
 (b) WANG ROOFING
Income Statement
For the Month Ended March 31, 2020

Revenues
Service revenue.................................................. ¥6,590
Expenses
Salaries and wages expense............................. ¥2,000
Supplies expense................................................ 1,520
Miscellaneous expense...................................... 400
Depreciation expense......................................... 250
Total expenses............................................ 4,170
Net income.................................................................. ¥2,420

WANG ROOFING
Owner’s Equity Statement
For the Month Ended March 31, 2020

Owner’s Capital, March 1........................................ ¥ 2,900

Investments.................................................. ¥10,000
Add: Net income.................................................... 2,420
12,420
15,320
Less: Drawings....................................................... 1,100
Owner’s Capital, March 31...................................... ¥14,220

WANG ROOFING
Statement of Financial Position
March 31, 2020

Assets
Property, plant, and equipment
Equipment........................................................... ¥11,000
Less: Accum. depreciation—equipment.......... 1,500 ¥9,500
Current assets
Supplies............................................................... 480
Accounts receivable........................................... 3,200
Cash..................................................................... 4,500
Total current assets.................................... 8,180
Total assets.................................................. ¥17,680
 WANG ROOFING
Statement of Financial Position (Continued)
March 31, 2020

Owner’s Equity and Liabilities

Owner’s Equity
Owner’s capital...................................................... ¥14,220
Current liabilities
Accounts payable.................................................. 2,500
Salaries and wages payable................................. 700
Unearned service revenue.................................... 260
Total current liabilities.................................. 3,460
Total owner’s equity and liabilities ............. ¥17,680
(c) Mar. 31 Supplies Expense........................................ 1,520
Supplies................................................ 1,520

31 Depreciation Expense................................. 250

Accumulated Depreciation—
Equipment......................................... 250

31 Unearned Service Revenue........................ 290

Service Revenue.................................. 290

31 Salaries and Wages Expense..................... 700

Salaries and Wages Payable............... 700
(d) Mar. 31 Service Revenue.......................................... 6,590
Income Summary................................. 6,590

31 Income Summary......................................... 4,170

Salaries and Wages Expense............. 2,000
Supplies Expense................................ 1,520
Depreciation Expense......................... 250
Miscellaneous Expense....................... 400

31 Income Summary......................................... 2,420

Owner’s Capital.................................... 2,420

31 Owner’s Capital........................................... 1,100

Owner’s Drawing.................................. 1,100
PROBLEM 4.4 (Continued)

(a) RUSTHE MANAGEMENT SERVICES

Worksheet
For the Year Ended December 31, 2020

Adjusted Income
Account Titles Trial Balance Adjustments Trial Balance Statement Statement of
Financial Position
Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr. Dr. Cr.
Cash 13,800 13,800 13,800
Accounts Receivable 28,300 28,300 28,300
Prepaid Insurance 3,600 (a) 1,500 2,100 2,100
Land 67,000 67,000 67,000
Buildings 127,000 127,000 127,000

PROBLEM 4.4
Equipment 59,000 59,000 59,000
Accounts Payable 12,500 12,500 12,500
Unearned Rent Revenue 6,000 (c) 5,000 1,000 1,000
Mortgage Payable 120,000 120,000 120,000
Owner’s Capital 144,000 144,000 144,000
Owner’s Drawings 22,000 22,000 22,000
Service Revenue 90,700 90,700 90,700
Rent Revenue 29,000 (c) 5,000 34,000 34,000
Salaries and Wages
Expense 42,000 42,000 42,000
Advertising Expense 20,500 20,500 20,500
Utilities Expense 19,000 19,000 19,000
Totals 402,200 402,200
Insurance Expense (a) 1,500 1,500 1,500
Depr. Expense (b) 6,600 6,600 6,600
Accum. Depr.—Buildings (b) 3,000 3,000 3,000
Accum. Depr.—Equipment (b) 3,600 3,600 3,600
Interest Expense (d) 10,000 10,000 10,000
Interest Payable (d) 10,000 10,000 10,000
Totals 23,100 23,100 418,800 418,800 99,600 124,700 319,200 294,100
Net Income 25,100 25,100
Totals 124,700 124,700 319,200 319,200

Key: (a) Expired Insurance; (b) Depreciation Expense—Building and Equipment; (c) Rent Revenue Recognized; (d) Accrued Interest Payable.
(b) RUSTHE MANAGEMENT SERVICES
Statement of Financial Position
December 31, 2020

Assets
Property, plant, and equipment
Land............................................. $67,000
Buildings..................................... $127,000
Less: Accumulated
depreciation—buildings........ 3,000 124,000
Equipment................................... 59,000
Less: Accumulated
depreciation—equipment...... 3,600 55,400 $246,400
Current assets
Prepaid insurance...................... 2,100
Accounts receivable.................. 28,300
Cash............................................. 13,800
Total current assets............ 44,200
Total assets......................... $290,600

Owner’s Equity and Liabilities

Owner’s Equity
Owner’s capital
($144,000 + $25,100 – $22,000).................... $147,100
Non-current liabilities
Mortgage payable.......................................... $75,000
Current liabilities
Mortgage payable (due in 2021) ….. $45,000
Accounts payable …………………... 12,500
Interest payable …………………….. 10,000
Unearned rent revenue ……………. 1,000
Total current liabilities........................... 68,500
Total liabilities........................................ 143,500
Total owner’s equity and liabilities...... $290,600
PROBLEM 4.4 (Continued)

(c) Dec. 31 Insurance Expense................................ 1,500

Prepaid Insurance.......................... 1,500

31 Depreciation Expense........................... 6,600

Accumulated Depreciation—
Buildings..................................... 3,000
Accumulated Depreciation—
Equipment................................... 3,600

31 Unearned Rent Revenue....................... 5,000

Rent Revenue................................. 5,000

31 Interest Expense.................................... 10,000

Interest Payable.............................. 10,000

(d) Dec. 31 Service Revenue.................................... 90,700

Rent Revenue......................................... 34,000
Income Summary........................... 124,700

31 Income Summary................................... 99,600

Salaries and Wages Expense........ 42,000
Advertising Expense...................... 20,500
Utilities Expense............................ 19,000
Interest Expense............................ 10,000
Depreciation Expense.................... 6,600
Insurance Expense........................ 1,500

31 Income Summary................................... 25,100

Owner’s Capital.............................. 25,100

31 Owner’s Capital...................................... 22,000

Owner’s Drawings.......................... 22,000
PROBLEM 4.4 (Continued)

(e) RUSTHE MANAGEMENT SERVICES

Post-Closing Trial Balance
December 31, 2020

Debit Credit
Cash.................................................................. $ 13,800
Accounts Receivable....................................... 28,300
Prepaid Insurance............................................ 2,100
Land.................................................................. 67,000
Buildings........................................................... 127,000
Accumulated Depreciation—Buildings.......... $ 3,000
Equipment........................................................ 59,000
Accumulated Depreciation—Equipment....... 3,600
Accounts Payable............................................ 12,500
Interest Payable............................................... 10,000
Unearned Rent Revenue................................. 1,000
Mortgage Payable............................................ 120,000
Owner’s Capital................................................ 147,100
$297,200 $297,200