50.1K

Verified Solution

Link Copied!

Alison and Chuck Renny began operations of their furniture repair shop (Lazy Sofa Furniture, Inc.) on January 1, 2014. The annual reporting period ends December 31. The trial balance on January 1, 2015, appears below (amounts are rounded to thousands of dollars to simplify).

Account Titles	Debit			Credit
Cash	$	5
Accounts Receivable		4
Supplies		2
Equipment		6
Accumulated Depreciation				$	0
Software		12
Accumulated Amortization					3
Accounts Payable					7
Notes Payable (long-term)					0
Salaries and Wages Payable					0
Interest Payable					0
Income Tax Payable					0
Unearned Revenue					0
Common Stock					15
Retained Earnings					4
Service Revenue					0
Supplies Expense		0
Depreciation Expense		0
Salaries and Wages Expense		0
Amortization Expense		0
Interest Expense		0
Income Tax Expense		0
Totals	$	29		$	29

Transactions during 2015 (summarized in thousands of dollars) follow:
1.	Borrowed $21 cash on July 1, 2015, signing a six-month note payable.
2.	Purchased equipment for $18 cash on July 2.
3.	Issued additional shares of common stock on July 3 for $5.
4.	Purchased additional equipment on August 4, $3 cash.
5.	Purchased, on account, supplies on September 5 for future use, $10.
6.	On December 6, recorded revenues in the amount of $65, including $9 on credit and $56 received in cash.
7.	Recognized salaries and wages expenses on December 7, and paid $35.
8.	Collected accounts receivable on December 8, $8.
9.	Paid accounts payable on December 9, $11.
10.	Received a $3 deposit on December 10 for work to start January 15, 2016.
Data for adjusting journal entries on December 31:
11.	Amortization for 2015, $3.
12.	Supplies of $4 were counted on December 31, 2015.
13.	Depreciation for 2015, $2.
14.	Accrued interest on notes payable of $1.
15.	Wages earned not yet paid, $3.
	16. Income tax for 2015 was $4 and will be paid in 2016. (Enter all of your answers in thousands of dollars. (i.e., $100,000 should be entered as $100).) Create a general journal, income statement, Statement of retained earnings and balance sheet

Answer & Explanation Solved by verified expert

See Answer