Stacey’s Piano Rebuilding Company has been operating for one year. At the start of the second year, its income statement accounts had zero balances and its balance sheet account balances were as follows:
| Cash | $ | 6,400 | Accounts payable | $ | 9,600 |
| Accounts receivable | 32,000 | Unearned revenue | 3,840 | ||
| Supplies | 1,500 | Long-term note payable | 48,500 | ||
| Equipment | 9,500 | Common stock | 1,600 | ||
| Land | 7,400 | Retained earnings | 11,560 | ||
| Building | 25,300 | Additional paid-in capital | 7,000 | ||
a. Rebuilt and delivered five pianos in January to customers who paid $19,000 in cash.
b. Received a $600 deposit from a customer who wanted her piano rebuilt.
c. Rented a part of the building to a bicycle repair shop; received $850 for rent in January.
d. Received $7,200 from customers as payment on their accounts.
e. Received an electric and gas utility bill for $400 to be paid in February.
f. Ordered $960 in supplies.
g. Paid $2,300 on account in January.
h. Received from the home of Stacey Eddy, the major shareholder, a $920 tool (equipment) to use in the business in exchange for 100 shares of $1 par value stock.
i. Paid $16,500 in wages to employees who worked in January.
j. Declared and paid a $2,200 dividend (reduce Retained Earnings and Cash).
k. Received and paid cash for the supplies in (f).
Required:
Prepare an income statement for January 31 (ignore income taxes). Fill in the letters
STACEY’S PIANO REBUILDING COMPANYIncome Statement (unadjusted)
For the Month Ended January 31
Operating revenues
a)
b)
Total operating revenues: a)
Operating expenses
a)
b)
c)
d)
Total operating expenses: a)
Other item:
a)
b)
c)
