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Assume the tax rate is 30%. Assume income tax has already been paid. You will just have to calculate the income tax expense on the income statement.

30

Account Title

Balance

Accounts Payable

$115,000

Accounts Receivable

95,000

Accumulated Depreciation

50,000

Bank Loan

40,000

Bonds Payable

Cash

47,165

Common Shares

Cost of Goods Sold

310,500

Depreciation Expense

25,000

Discount on Bonds

Gain on Fair Value Adjustment

Insurance Expense

2,000

Interest Expense

2,000

-7000

Interest Payable

7,000

Interest Revenue

Inventory

60,000

Investment in Associate - Gregor Inc.

Long-Term Investment - Bond

Loss on Fair Value Adjustment

Loss from Discontinued Operations

(14,700)

Maintenance Expense

9,000

Preferred Shares

Premium on Bonds

Prepaid Insurance

16,000

Professional Fees Expense

6,600

Property, Plant & Equipment

240,000

Rent Expense

38,000

Revenue from Investment in Associate

Salaries Expense

75,000

Sales Discounts

8,000

Sales Returns and Allowances

10,000

Sales Revenue

690,000

Short-Term Investment - Daenerys Inc.

Telephone Expense

4,000

Travel Expense

16,700

Unearned Revenue

88,230

Notes:

The bank loan is payable over 8 years and $5,000 will be paid by December 31, 2021.

Prepare a statement of retained earnings at December 31, 2020. Round answers to the nearest whole number.

Holister Electric Inc.
Statement of Retained Earnings
For the Year Ended December 31, 2020

Prepare a Classified Balance Sheet at December 31, 2020. Round answers to the nearest whole number.

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