Question

Finders Investigative Services is an investigative services firm that is owned and operated by Stacy Tanner. On June 30, 2019, the end of the fiscal year, the accountant for Finders Investigative Services prepared an end-of-period spreadsheet, a part of which follows:
Finders Investigative Services
End-of-Period Spreadsheet
For the Year Ended June 30, 2019
~ Adjusted Trial Balance
Account Title ~ Dr. Cr.
~
Cash ~ 28,000
Accounts Receivable ~ 69,600
Supplies ~ 4,600
Prepaid Insurance ~ 2,500
Building ~ 439,500
Accumulated Depreciation-Building ~ 44,200
Accounts Payable ~ 11,700
Salaries Payable ~ 3,000
Unearned Rent ~ 2,000
Stacy Tanner, Capital ~ 373,800
Stacy Tanner, Drawing ~ 12,000
Service Fees ~ 718,000
Rent Revenue ~ 12,000
Salaries Expense ~ 522,100
Rent Expense ~ 48,000
Supplies Expense ~ 10,800
Depreciation Expense-Building ~ 8,750
Utilities Expense ~ 7,150
Repairs Expense ~ 3,000
Insurance Expense ~ 2,500
Miscellaneous Expense ~ 6,200
~ 1,164,700 1,164,700
Required:
(1) Prepare an income statement, a statement of owner’s equity (no additional investments were made during the year), and a balance sheet. *
(2) Journalize the entries that were required to close the accounts at June 30.

Answer 1

Answer:

Net Profit   121,500

Stacy Tanner, Capital 483,300

Explanation:

Finders Investigative Services

End-of-Period Income Statement

For the Year Ended June 30, 2019

Service Fees                                                     $  ~ 718,000

Rent Revenue                                                      ~ 12,000

                                                                            730,000

Salaries Expense                     ~ 522,100

Rent Expense                          ~ 48,000

Supplies Expense                     ~ 10,800

Depreciation Expense-Building ~ 8,750

Utilities Expense                          ~ 7,150

Repairs Expense                         ~ 3,000

Insurance Expense                     ~ 2,500

Miscellaneous Expense              ~ 6,200                         608,500

Net Profit                                                                        $121,500

Finders Investigative Services

End-of-Period Owner's Equity

For the Year Ended June 30, 2019  

Stacy Tanner, Capital                             $ ~ 373,800

Add Income                                             121,500             495,300  

Less Drawing                                                 12,000

Stacy Tanner, Capital                                                  $  483,300

Finders Investigative Services

End-of-Period Balance Sheet

For the Year Ended June 30, 2019

Balance

Account Title                                       ~ Dr.                      Cr. ~

Cash                                                 ~ 28,000

Accounts Receivable                        ~ 69,600

Supplies                                              ~ 4,600

Prepaid Insurance                              ~ 2,500

Building                                            ~ 395,300

Accounts Payable                                                              ~ 11,700

Salaries Payable                                                                ~ 3,000

Unearned Rent                                                                  ~ 2,000

Stacy Tanner, Capital                                                      ~ 483,300

                                                   $  500,000                   $  500,000

Journal Entries

1) Income Summary     $ 608500 Dr

Salaries Expense                     ~ 522,100 Cr

Rent Expense                          ~ 48,000 Cr

Supplies Expense                     ~ 10,800 Cr

Depreciation Expense-Building ~ 8,750 Cr

Utilities Expense                          ~ 7,150 Cr

Repairs Expense                         ~ 3,000 Cr

Insurance Expense                     ~ 2,500 Cr

Miscellaneous Expense              ~ 6,200 Cr

2)     Service Fees                     $  ~ 718,000 Dr

Rent Revenue                            ~ 12,000 Dr

          Income Summary                           $ 730,000 Cr

3) Income Summary  $121,500 Dr

Stacy Tanner Capital Account               $ 121,500 Cr

4) Stacy Tanner Capital Account           $ 12,000 Dr

Stacy Tanner Drawings                  $ 12000 Cr