Course Name FINANCIAL ACCOUNTING Date Presented here are the

Course Name FINANCIAL ACCOUNTING Date: Presented here are the accounts of Quaid Corporation for the vear ended December 31. 2011. Cash 24,000 53,500 30,000 126,000 4,500 80,000 18,000 4,800 2,400 3,600 18,000 Supplies Inventory Prepaid Rent Equipment-Net After Depreciation 16,000 common stock eou-7 28,000 Retained Earnings 1/1/11 4,000 Dividends netained orN 1,200 Service Revenue 31,200 Depreciation Expense PNC Salary expense P Accounts payable Interest payable Unearned service revenue Income tax payable Note payable-Long Term NOTE: SOME OF THE ABOVE BALANCES ARE DEBITS AND THE OTHERS ARE CREDITS. YOU NEED TO PLACE ACCOUNTS ONTO THE PROPER FINANCIAL STATEMENT 14,000 Rent Expense PNL 800 |Interest Expense PN 2,400 Insurance expense PNL 5,000 Supplies expense f Requirements: 1 Prepare Quaid Corporation\'s SINGLE STEP Income Statement. 2. Prepare the Statement of Retained Earnings 3. Prepare the Balance Sheet. Req. 1 Quaid Corporation Income Statement Year Ended December 31, 2011 Revenue: Expenses nsurance E 21 30 Total expenses Net income

Solution

Quaid Corporation Income Statement Year ended 31, 2011 $ $ Revenue: Service Revenue (126000-2400)       123,600 Expenses: Depreciation Expense         4,500 Salary Expense      80,000 Rent Expense (18000-1200)      16,800 Interest Expense (4800+800)         5,600 Insurance Expense         2,400 Supplies Expense         3,600 Income Tax Expense (18000+5000)      23,000 Total Expense       135,900 Net Income       (12,300) Statement of Retained Earnings $ Retained Earnings at 1/1/11          53,500 Add : Net Income for the year       (12,300) Less : Dividends Paid          30,000 Retained Earnings at 31, 2011          11,200 Quaid Corporation Balancesheet as on 31, 2011 Assets $ $ Current Assets Current Liabilities Cash      16,000 Accounts Payables      14,000 Accounts Receivable      28,000 Interest Payables            800 Supplies Inventory         4,000 Unearned Service revenue         2,400 Prepaid Rent         1,200 Income Tax Payable      18,000 Total Current Assets      49,200 Total Current Liabilities      35,200 Property Plant and Equipment      31,200 Non Current Liabilities Note Payable      16,000 suspense account         6,000 Owner\'s Equity Common Stock      24,000 Retained Earnings      11,200 Total Equity      35,200 Total Assets      86,400 Total Liabilities and Stockholder\'s Equity      86,400 Computation of Current Ratio Current Ratio = Current Assets/ Current Liabilities = 49200/22200 =           2.22 Calculation of Working Capital Working Capital = Current Assets - Current Liabilities = 49200 - 22200 = $27,000