Trial Balance Use the following account balance information

Trial Balance Use the following account balance information to construct a trial balance: Salary Expense Unearned Service Revenue Paid-In Capital Cash $32,000 5,300 1,200 5,000 $24,000 Service Revenue 1,600 3,000 3,500 Rent Expense Retained Earnings (beginning) Prepaid Rent Expense

Solution

Step-1:Prepare Income Statement Service Revenue $ 32,000 Rent expenses $ -5,300 Salary expenses $-24,000 Net Income $   2,700 Step-2:Prepare Retained Earning Statement Retained Earning(Beginning) $   1,200 Add:Net Income $   2,700 Less:Dividend 0 Retained Earning(Ending) $   3,900 Step-3:Now prepare Balance sheet Cash $   3,500 Unearned service revenue $   1,600 Prepaid rent expenses $   5,000 Current Liabilities $   1,600 Current Assets $   8,500 Long term debt 0 Total Liabilities $   1,600 Property,Plant and Equipment 0 Stockholder\'s Equity: Paid-in Capital $   3,000 Retained Earning(Ending) $   3,900 Total Stockholder\'s Equity $   6,900 Total Assets $   8,500 Total liablities and equity $   8,500