Based on the following trial balance for Sally's Salon, prepare an income statement, statement of retained earnings, and a balance sheet. Sally Crawford, the sole stockholder, made no additional investments in the company during the year.
What will be an ideal response?
| Sally's Salon Income Statement For Year Ended December 31 | ||||
| Revenue earned……………... | ? | ? | ? | $72,000 |
| Expenses: | ? | ? | ? | ? |
| Beauty supplies expense…. | ? | $ 3,425 | ? | ? |
| Rent expense………………. | ? | 6,000 | ? | ? |
| Wages expense……………. | ? | 22,000 | ? | ? |
| Total expenses…………….. | ? | ? | ? | 31,425 |
| Net Income………………….. | ? | ? | ? | $40,575 |
| ? | Sally's Salon Statement of Retained Earnings For Year Ended December 31 | ||
| ? | Retained earnings, January 1……………………. | $0 | ? |
| ? | Plus: Net income………………………………………….. | 40,575 | ? |
| ? | ? | $40,575 | ? |
| ? | Less: Withdrawals by owner…………………………….. | (36,000) | ? |
| ? | Retained earnings, December 31………………. | $4,575 | ? |
Balance Sheet
At December 31
| Assets | ? | Liabilities | ? |
| Cash…………………….. | $ 6,500 | Accounts payable………… | $ 745 |
| Accounts receivable…….. | 475 | ? | ? |
| Beauty supplies…………. | 2,500 | Equity | ? |
| Beauty shop equipment…. | 17,000 | Common Stock…… | 21,155 |
| ? | _____ | Retained Earnings | 4,575 |
| Total assets……………… | $26,475 | Total liabilities and equity. | $26,475 |
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