15
Problem 5b: Financial Statements, Closing Entries, Posting, and Post-closing Trial Balance
1. Kimberly Bussey is the primary stockholder in the Bussey Appliance Repair Service. The Bussey Appliance Repair Service's adjusted trial balance as of March 31 is shown below. Based on the adjusted trial balance, determine Bussey Appliance Repair Service's net income for March.
Bussey Appliance Repair ServiceAdjusted Trial Balance
March 31
Account Name / Debits / Credits
Cash / $16,600
Accounts Receivable / $6,000
Supplies / $2,500
Prepaid Insurance / $2,300
Prepaid Rent / $1,100
Accounts Payable / $4,900
Wages Payable / $1,200
Income Taxes Payable / $1,500
Unearned Fees / $400
Common Stock / $15,000
Retained Earnings / $4,850
Dividends / $550
Fees Revenue / $7,500
Supplies Expense / $800
Insurance Expense / $600
Rent Expense / $850
Wages Expense / $3,500
Telephone Expense / $50
Income Taxes Expense / $500
Totals / $35,350 / $35,350
A) / $650
B) / $28,500
C) / $7,500
D) / $1,200
E) / $5,500
2. Based on the adjusted trial balance, determine Bussey Appliance Repair Service's total assets on March 31.
Adjusted Trial Balance
March 31
Account Name / Debits / Credits
Cash / $16,600
Accounts Receivable / $6,000
Supplies / $2,500
Prepaid Insurance / $2,300
Prepaid Rent / $1,100
Accounts Payable / $4,900
Wages Payable / $1,200
Income Taxes Payable / $1,500
Unearned Fees / $400
Common Stock / $15,000
Retained Earnings / $4,850
Dividends / $550
Fees Revenue / $7,500
Supplies Expense / $800
Insurance Expense / $600
Rent Expense / $850
Wages Expense / $3,500
Telephone Expense / $50
Income Taxes Expense / $500
Totals / $35,350 / $35,350
A) / $28,500
B) / $35,350
C) / $15,000
D) / $20,500
E) / $8,000
3. Based on the adjusted trial balance, determine Bussey Appliance Repair Service's total liabilities on March 31.
Adjusted Trial Balance
March 31
Account Name / Debits / Credits
Cash / $16,600
Accounts Receivable / $6,000
Supplies / $2,500
Prepaid Insurance / $2,300
Prepaid Rent / $1,100
Accounts Payable / $4,900
Wages Payable / $1,200
Income Taxes Payable / $1,500
Unearned Fees / $400
Common Stock / $15,000
Retained Earnings / $4,850
Dividends / $550
Fees Revenue / $7,500
Supplies Expense / $800
Insurance Expense / $600
Rent Expense / $850
Wages Expense / $3,500
Telephone Expense / $50
Income Taxes Expense / $500
Totals / $35,350 / $35,350
A) / $28,500
B) / $35,350
C) / $4,900
D) / $7,600
E) / $8,000
4. Based on the adjusted trial balance, determine Bussey Appliance Repair Service's total stockholders' equity on March 31.
Adjusted Trial Balance
March 31
Account Name / Debits / Credits
Cash / $16,600
Accounts Receivable / $6,000
Supplies / $2,500
Prepaid Insurance / $2,300
Prepaid Rent / $1,100
Accounts Payable / $4,900
Wages Payable / $1,200
Income Taxes Payable / $1,500
Unearned Fees / $400
Common Stock / $15,000
Retained Earnings / $4,850
Dividends / $550
Fees Revenue / $7,500
Supplies Expense / $800
Insurance Expense / $600
Rent Expense / $850
Wages Expense / $3,500
Telephone Expense / $50
Income Taxes Expense / $500
Totals / $35,350 / $35,350
A) / $28,500
B) / $35,350
C) / $20,500
D) / $19,850
E) / $8,000
5. Based on the adjusted trial balance, prepare the journal entry to close the fees revenue account at the end of March.
Adjusted Trial Balance
March 31
Account Name / Debits / Credits
Cash / $16,600
Accounts Receivable / $6,000
Supplies / $2,500
Prepaid Insurance / $2,300
Prepaid Rent / $1,100
Accounts Payable / $4,900
Wages Payable / $1,200
Income Taxes Payable / $1,500
Unearned Fees / $400
Common Stock / $15,000
Retained Earnings / $4,850
Dividends / $550
Fees Revenue / $7,500
Supplies Expense / $800
Insurance Expense / $600
Rent Expense / $850
Wages Expense / $3,500
Telephone Expense / $50
Income Taxes Expense / $500
Totals / $35,350 / $35,350
A) / Fees Revenue / $7,500
Income Summary / $7,500
B) / Fees Revenue / $7,500
Cash / $7,500
C) / Retained Earnings / $7,500
Fees Revenue / $7,500
D) / Fees Revenue / $7,500
Retained Earnings / $7,500
E) / Income Summary / $7,500
Fees Revenue / $7,500
6. Based on the adjusted trial balance, prepare the journal entry to close the supplies expense account at the end of March.
Adjusted Trial Balance
March 31
Account Name / Debits / Credits
Cash / $16,600
Accounts Receivable / $6,000
Supplies / $2,500
Prepaid Insurance / $2,300
Prepaid Rent / $1,100
Accounts Payable / $4,900
Wages Payable / $1,200
Income Taxes Payable / $1,500
Unearned Fees / $400
Common Stock / $15,000
Retained Earnings / $4,850
Dividends / $550
Fees Revenue / $7,500
Supplies Expense / $800
Insurance Expense / $600
Rent Expense / $850
Wages Expense / $3,500
Telephone Expense / $50
Income Taxes Expense / $500
Totals / $35,350 / $35,350
A) / Supplies / $800
Supplies Expense / $800
B) / Supplies Expense / $800
Retained Earnings / $800
C) / Retained Earnings / $800
Supplies Expense / $800
D) / Supplies Expense / $800
Income Summary / $800
E) / Income Summary / $800
Supplies Expense / $800
7. Based on the adjusted trial balance, prepare the journal entry to close the income summary account at the end of March.
Adjusted Trial Balance
March 31
Account Name / Debits / Credits
Cash / $16,600
Accounts Receivable / $6,000
Supplies / $2,500
Prepaid Insurance / $2,300
Prepaid Rent / $1,100
Accounts Payable / $4,900
Wages Payable / $1,200
Income Taxes Payable / $1,500
Unearned Fees / $400
Common Stock / $15,000
Retained Earnings / $4,850
Dividends / $550
Fees Revenue / $7,500
Supplies Expense / $800
Insurance Expense / $600
Rent Expense / $850
Wages Expense / $3,500
Telephone Expense / $50
Income Taxes Expense / $500
Totals / $35,350 / $35,350
A) / Income Summary / $650
Retained Earnings / $650
B) / Income Summary / $1,200
Retained Earnings / $1,200
C) / Income Summary / $4,850
Retained Earnings / $4,850
D) / Common Stock / $1,200
Income Summary / $1,200
E) / Retained Earnings / $1,200
Income Summary / $1,200
8. Based on the adjusted trial balance, prepare the journal entry to close the dividends account at the end of March.
Adjusted Trial Balance
March 31
Account Name / Debits / Credits
Cash / $16,600
Accounts Receivable / $6,000
Supplies / $2,500
Prepaid Insurance / $2,300
Prepaid Rent / $1,100
Accounts Payable / $4,900
Wages Payable / $1,200
Income Taxes Payable / $1,500
Unearned Fees / $400
Common Stock / $15,000
Retained Earnings / $4,850
Dividends / $550
Fees Revenue / $7,500
Supplies Expense / $800
Insurance Expense / $600
Rent Expense / $850
Wages Expense / $3,500
Telephone Expense / $50
Income Taxes Expense / $500
Totals / $35,350 / $35,350
A) / Retained Earnings / $4,850
Dividends / $4,850
B) / Retained Earnings / $650
Dividends / $650
C) / Dividends / $550
Retained Earnings / $550
D) / Retained Earnings / $550
Dividends / $550
E) / Common Stock / $550
Dividends / $550
9. The Bussey Appliance Repair Service's post-closing trial balance as of March 31 is shown below. Based on the post-closing trial balance, determine Bussey Appliance Repair Service's total assets on March 31.
Post-closing Trial Balance
March 31
Account Name / Debits / Credits
Cash / $16,600
Accounts Receivable / $6,000
Supplies / $2,500
Prepaid Insurance / $2,300
Prepaid Rent / $1,100
Accounts Payable / $4,900
Wages Payable / $1,200
Income Taxes Payable / $1,500
Unearned Fees / $400
Common Stock / $15,000
Retained Earnings / $5,500
Dividends / $0
Fees Revenue / $0
Supplies Expense / $0
Insurance Expense / $0
Rent Expense / $0
Wages Expense / $0
Telephone Expense / $0
Income Taxes Expense / $0
Totals / $28,500 / $28,500
A) / $1,200
B) / $15,000
C) / $28,500
D) / $8,000
E) / $20,500
10. Based on the post-closing trial balance, determine Bussey Appliance Repair Service's total liabilities on March 31.
Post-closing Trial Balance
March 31
Account Name / Debits / Credits
Cash / $16,600
Accounts Receivable / $6,000
Supplies / $2,500
Prepaid Insurance / $2,300
Prepaid Rent / $1,100
Accounts Payable / $4,900
Wages Payable / $1,200
Income Taxes Payable / $1,500
Unearned Fees / $400
Common Stock / $15,000
Retained Earnings / $5,500
Dividends / $0
Fees Revenue / $0
Supplies Expense / $0
Insurance Expense / $0
Rent Expense / $0
Wages Expense / $0
Telephone Expense / $0
Income Taxes Expense / $0
Totals / $28,500 / $28,500
A) / $8,000
B) / $4,900
C) / $28,500
D) / $7,600
E) / $5,500
11. Based on the post-closing trial balance, determine Bussey Appliance Repair Service's total stockholders' equity on March 31.
Post-closing Trial Balance
March 31
Account Name / Debits / Credits
Cash / $16,600
Accounts Receivable / $6,000
Supplies / $2,500
Prepaid Insurance / $2,300
Prepaid Rent / $1,100
Accounts Payable / $4,900
Wages Payable / $1,200
Income Taxes Payable / $1,500
Unearned Fees / $400
Common Stock / $15,000
Retained Earnings / $5,500
Dividends / $0
Fees Revenue / $0
Supplies Expense / $0
Insurance Expense / $0
Rent Expense / $0
Wages Expense / $0
Telephone Expense / $0
Income Taxes Expense / $0
Totals / $28,500 / $28,500
A) / $15,000
B) / $28,500
C) / $20,500
D) / $15,000
E) / $5,500
12. Determine the dollar amount of the Bussey Appliance Repair Service’s total resources on March 31.
Post-closing Trial Balance
March 31
Account Name / Debits / Credits
Cash / $16,600
Accounts Receivable / $6,000
Supplies / $2,500
Prepaid Insurance / $2,300
Prepaid Rent / $1,100
Accounts Payable / $4,900
Wages Payable / $1,200
Income Taxes Payable / $1,500
Unearned Fees / $400
Common Stock / $15,000
Retained Earnings / $5,500
Dividends / $0
Fees Revenue / $0
Supplies Expense / $0
Insurance Expense / $0
Rent Expense / $0
Wages Expense / $0
Telephone Expense / $0
Income Taxes Expense / $0
Totals / $28,500 / $28,500
A) / $1,200
B) / $15,000
C) / $8,000
D) / $28,500
E) / $20,500
13. Determine the dollar amount of March 31 resources that the Bussey Appliance Repair Service obtained through borrowing.
Post-closing Trial Balance
March 31
Account Name / Debits / Credits
Cash / $16,600
Accounts Receivable / $6,000
Supplies / $2,500
Prepaid Insurance / $2,300
Prepaid Rent / $1,100
Accounts Payable / $4,900
Wages Payable / $1,200
Income Taxes Payable / $1,500
Unearned Fees / $400
Common Stock / $15,000
Retained Earnings / $5,500
Dividends / $0
Fees Revenue / $0
Supplies Expense / $0
Insurance Expense / $0
Rent Expense / $0
Wages Expense / $0
Telephone Expense / $0
Income Taxes Expense / $0
Totals / $28,500 / $28,500
A) / $2,500
B) / $8,000
C) / $28,500
D) / $4,900
E) / $7,600
14. Determine the dollar amount of March 31 resources that the Bussey Appliance Repair Service obtained from owners.
Post-closing Trial Balance
March 31
Account Name / Debits / Credits
Cash / $16,600
Accounts Receivable / $6,000
Supplies / $2,500
Prepaid Insurance / $2,300
Prepaid Rent / $1,100
Accounts Payable / $4,900
Wages Payable / $1,200
Income Taxes Payable / $1,500
Unearned Fees / $400
Common Stock / $15,000
Retained Earnings / $5,500
Dividends / $0
Fees Revenue / $0
Supplies Expense / $0
Insurance Expense / $0
Rent Expense / $0
Wages Expense / $0
Telephone Expense / $0
Income Taxes Expense / $0
Totals / $28,500 / $28,500
A) / $1,200
B) / $20,500
C) / $28,500
D) / $8,000
E) / $15,000
15. Determine the dollar amount of March 31 resources that the Bussey Appliance Repair Service generated through management operations and kept in the company.
Post-closing Trial Balance
March 31
Account Name / Debits / Credits
Cash / $16,600
Accounts Receivable / $6,000
Supplies / $2,500
Prepaid Insurance / $2,300
Prepaid Rent / $1,100
Accounts Payable / $4,900
Wages Payable / $1,200
Income Taxes Payable / $1,500
Unearned Fees / $400
Common Stock / $15,000
Retained Earnings / $5,500
Dividends / $0
Fees Revenue / $0
Supplies Expense / $0
Insurance Expense / $0
Rent Expense / $0
Wages Expense / $0
Telephone Expense / $0
Income Taxes Expense / $0
Totals / $28,500 / $28,500
A) / $5,500
B) / $15,000
C) / $28,500
D) / $1,200
E) / $20,500