Answer:
George Cooper Co.
a. Income Statement for the year ended December 31, 2020:
Service Revenue $12,515
Salaries and Wages Expense 7,765
Rent Expense 2,190
Depreciation Expense 215
Interest Expense 153 10,323
Net income $2,192
b. Statement of Retained Earnings for the year ended December 31, 2020
Retained Earnings $12,235
Net income 2,192
Dividends 3,925
Retained Earnings $10,502
c. Classified Balance Sheet as of December 31, 2020
Assets:
Current Assets:
Cash $20,397
Accounts Receivable 7,845
Prepaid Rent 3,205 $31,447
Long-term assets:
Equipment $18,975
Accumulated Depreciation 5,820 $13,155
Total assets $44,602
Liabilities and Equity:
Current liabilities:
Notes Payable 6,625
Accounts Payable 6,397
Interest Payable 153
Total liabilities $13,175
Equity:
Common Stock 20,925
Retained Earnings 10,502 $31,427
Total liabilities and equity $44,602
Explanation:
a) Data and Calculations:
GEORGE COOPER CO.
ADJUSTED TRIAL BALANCE DECEMBER 31, 2020
Debit Credit
Cash $20,397
Accounts Receivable 7,845
Prepaid Rent 3,205
Equipment 18,975
Accumulated Depreciation-Equipment $5,820
Notes Payable 6,625
Accounts Payable 6,397
Interest Payable 153
Common Stock 20,925
Retained Earnings 12,235
Dividends 3,925
Service Revenue 12,515
Salaries and Wages Expense 7,765
Rent Expense 2,190
Depreciation Expense 215
Interest Expense 153
Totals $64,670 $64,670
