Question

Mijka Company was started on January 1, 2018. During 2018, the company experienced the following three accounting events: (1) earned cash revenues of $34,600, (2) paid cash expenses of $15,200, and (3) paid a $3,500 cash dividend to its stockholders. These were the only events that affected the company during 2018.
Required:

Record the effects of each accounting event under the appropriate general ledger account headings.

Prepare an income statement, statement of changes in stockholders’ equity, and a balance sheet dated December 31, 2018, for Mijka Company.

Answer 1

Answer:

Explanation:

           Assets = Liabilities + Stockholder's equity

             Cash=                                        Common  stock+Retained earnings

1. Cash

revenues 34600  NA  NA  34600

2. Paid

expenses(15200)  NA  NA  (15200)

3. Paid

dividend (3500)  NA  NA  (3500)

Ending balance 15900 = 0 + 0 + 15900

Income statement  

Revenue $34600

Expense (15200)

Net income $19400

Statement of changes in stockholders’ equity

Common stock  $0

Retained earnings:  

Net income $19400  

Less: dividends (3500)

Total stockholder's equity  $15900

Balance sheet  

Assets:  

Cash $15900

Liabilities $0

Stockholder's equity:  

Common stock 0

Retained earnings 15900

Total stockholder's equity $15900

Total liabilities and stockholder's equity $15900