C4–4 (continued)
Req. 3 LAZY SOFA FURNITURE, INC.
Unadjusted Trial Balance
At December 31, 2015
(in thousands)
Account Titles
Debit
Credit
Cash
$ 31
Accounts Receivable
5
Supplies
12
Equipment
27
Accumulated Depreciation–Equipment
$ 0
Software
12
Accumulated Amortization
3
Accounts Payable
6
Notes Payable (short–term)
21
Salaries and Wages Payable
0
Interest Payable
0
Income Tax Payable
0
Unearned Revenue
3
Common Stock
20
Retained Earnings
4
Service Revenue
65
Supplies Expenses
0
Salaries and Wages Expense
35
Depreciation Expense
0
Amortization Expense
0
Interest Expense
0
Income Tax Expense
0
Totals
$ 122
$ 122
C4–4 (continued)
Req. 4
11
Amortization Expense (+E, –SE) ………………….
3
Accumulated Amortization (xA,–A) ………
3
To record amortization for the year (amount is
given).
12
Supplies Expenses (+E, −SE) ……………………..
8
Supplies (−A) …………………………………….
8
To record supplies used–up ($12 – 4).
13
Depreciation Expense (+E, −SE) ………………….
2
Accum. Depn–Equip. (+xA, −A) ……………
2
14
Interest Expense (+E, −SE) …………………………
1
Interest Payable (+L) ………………………….
1
To accrue interest for July – December, 2015.
15
Salaries and Wages Expense (+E, −SE) ……….
3
Salaries and Wages Payable (+L) ………..
3
To accrue salaries and wages incurred but not
paid.
16
Income Tax Expense (+E, −SE) …………………..
4
Income Tax Payable (+L) ……………………
4
To accrue income tax.
C4–4 (continued)
Req. 5 LAZY SOFA FURNITURE, INC.
Adjusted Trial Balance
At December 31, 2015
(in thousands)
Account Titles
Debit
Credit
Cash
$ 31
Accounts Receivable
5
Supplies
4
Equipment
27
Accumulated Depreciation–Equipment
$ 2
Software
12
Accumulated Amortization
6
Accounts Payable
6
Notes Payable (short–term)
21
Salaries and Wages Payable
3
Interest Payable
1
Income Tax Payable
4
Unearned Revenue
3
Common Stock
20
Retained Earnings
4
Service Revenue
65
Supplies Expenses
8
Salaries and Wages Expense
38
Depreciation Expense
2
Amortization Expense
3
Interest Expense
1
Income Tax Expense
4
Totals
$ 135
$ 135
C4–4 (continued)
Req. 6 LAZY SOFA FURNITURE, INC.
Income Statement
For the Year Ended December 31, 2015
(in thousands)
Revenues:
Service Revenue
$ 65
Expenses:
Salaries and Wages Expense
38
Supplies Expenses
8
Amortization Expense
3
Depreciation Expense
2
Interest Expense
1
Income Tax Expense
4
Total Expenses
56
Net Income
$ 9
LAZY SOFA FURNITURE, INC.
Statement of Retained Earnings
For the Year Ended December 31, 2015
(in thousands)
Balance, January 1, 2015
$ 4
Add: Net Income
9
Subtract: Dividends
(0)
Balance, December 31, 2015
$ 13
C4–4 (continued)
Req. 6 (continued)
LAZY SOFA FURNITURE, INC.
Balance Sheet
At December 31, 2015
C4–4 (continued)
Req. 8
LAZY SOFA FURNITURE, INC.
Post–Closing Trial Balance
At December 31, 2015
(in thousands)
Account Titles
Debit
Credit
Cash
$ 31
Accounts Receivable
5
Supplies
4
Equipment
27
Accumulated Depreciation–Equipment
$ 2
Software
12
Accumulated Amortization
6
Accounts Payable
6
Notes Payable
21
Salaries and Wages Payable
3
Interest Payable
1
Income Tax Payable
4
Unearned Revenue
3
Common Stock
20
Retained Earnings
13
Service Revenue
0
Salaries and Wages Expense
0
Supplies Expenses
0
Depreciation Expense
0
Income Tax Expense
0
Interest Expense
0
Income Tax Expense
0
Totals
$ 79
$ 79
Req. 9
Lazy Sofa Furniture, Inc., generated $9 (thousand) in net income during 2015. The
company is financed primarily by liabilities, with liabilities providing financing for $38
(thousand) of total assets and stockholders’ equity providing financing of $33
(thousand).
C4–5
Req. 1
a)
Cash (+A)
2,000
Service Revenue (+R, +SE)
2,000
b)
Salaries and Wages Expense (+E, –SE)
1,000
Cash (–A)
900
Salaries and Wages Payable (+L)
100
c)
Accounts Receivable (+A)
750
Service Revenue (+R, +SE)
750
d)
Salaries and Wages Expense (+E, –SE)
200
Cash (–A)
200
e)
Cash (+A)
200
Accounts Receivable (–A)
200
f)
Cash (+A)
250
Unearned Revenue (+L)
250
g)
Depreciation Expense (+E, –SE)
100
Accum. Depreciation–Equip.(+xA, –A)
100
h)
Interest Expense (+E, –SE)
40
Interest Payable (+L)
40
i)
Supplies Expense (+E, –SE)
60
Supplies (–A)
60
j)
Income Tax Expense (+E, –SE)
405
Income Tax Payable (+L)
405
C4–5 (continued)
Req. 2
Notes:
1. Service Revenue includes amounts from a) and c) in Req. 1.
3. All other temporary account balances derive from only one journal entry in Req. 1.
House of Tutors, Incorporated
Income Statement
House of Tutors, Incorporated
Statement of Retained Earnings
C4–5 (continued)
Req. 3
House of Tutors, Incorporated
Balance Sheet
September 30
ASSETS
Current Assets
Cash $ 2,050
C4–6
Req. 1
Jan. 1)
Prepaid Insurance (+A)
5,700
Cash (–A)
5,700
2)
Prepaid Rent (+A)
4,200
Cash (–A)
4,200
3)
Cash (+A)
30,000
Note Payable (+L)
30,000
4)
Equipment (+A)
24,000
Cash (–A)
24,000
5)
Cash (+A)
6,000
Common Stock (+SE)
6,000
6)
Supplies (+A)
1,000
Accounts Payable (+L)
1,000
7)
Cash (+A)
600
Accounts Receivable (–A)
600
8)
Accounts Payable (–L)
400
Cash (–A)
400
9)
Accounts Receivable (+A)
10,400
Service Revenue (+R, +SE)
10,400
10)
Cash (+A)
7,600
Service Revenue (+R, +SE)
7,600
16)
Salaries and Wages Expense (+E, –SE)
2,200
Cash (–A)
2,200
20)
Cash (+A)
3,500
Unearned Revenue (+L)
3,500
25)
Cash (+A)
4,500
Accounts Receivable (–A)
4,500