Problems (Group A)
P4-29A Preparing financial statements including a classified balance sheet in report form,
preparing and posting closing entries, and preparing a post-closing trial balance
Learning Objectives 1, 3, 4
1. Net Loss $(9,500)
The adjusted trial balance of Erickson Real Estate Appraisal at June 30, 2018, follows:
Requirements
1. Prepare the company’s income statement for the year ended June 30, 2018.
2. Prepare the company’s statement of retained earnings for the year ended June 30, 2018.
3. Prepare the company’s classified balance sheet in report form at June 30, 2018.
4. Journalize the closing entries.
5. Open the T-accounts using the balances from the adjusted trial balance, and post the closing
entries to the T-accounts.
6. Prepare the company’s post-closing trial balance at June 30, 2018
SOLUTION
P4-29A, cont.
Requirement 4
P4-29A, cont.
Requirement 5
P4-30A Preparing financial statements including a classified balance sheet in report form,
preparing closing entries, and using the current ratio to evaluate a company
Learning Objectives 1, 3, 6
2. Ending Retained Earnings $68,200
The adjusted trial balance of Boston Irrigation System at December 31, 2018, follows:
Requirements
1. Prepare the company’s income statement for the year ended December 31, 2018.
2. Prepare the company’s statement of retained earnings for the year ended December 31, 2018.
3. Prepare the company’s classified balance sheet in report form at December 31, 2018.
4. Journalize the closing entries for Boston Irrigation System.
5. Compute the company’s current ratio at December 31, 2018. At December 31, 2017, the
current ratio was 2.3. Did the company’s ability to pay current debts improve or deteriorate,
or did it remain the same?
SOLUTION
