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Financial Statements and Closing Entries

The Gorman Group is a financial planning services firm owned and operated by Nicole Gorman. As of October 31, 2019, the end of the fiscal year, the accountant for The Gorman Group prepared an end-of-period spreadsheet, part of which follows:

The Gorman Group End-of-Period Spreadsheet For the Year Ended October 31, 2019
	Adjusted Trial Balance
Account Title	Dr.	Cr.
Cash	$12,910
Accounts Receivable	28,100
Supplies	4,390
Prepaid Insurance	9,480
Land	100,000
Buildings	359,000
Accumulated Depreciation-Buildings		116,900
Equipment	259,000
Accumulated Depreciation-Equipment		152,300
Accounts Payable		33,230
Salaries Payable		3,290
Unearned Rent		1,490
Nicole Gorman, Capital		426,230
Nicole Gorman, Drawing	24,900
Service Fees		473,900
Rent Revenue		5,000
Salaries Expense	339,740
Depreciation ExpenseEquipment	18,400
Rent Expense	15,500
Supplies Expense	10,930
Utilities Expense	9,880
Depreciation ExpenseBuildings	6,590
Repairs Expense	5,440
Insurance Expense	2,990
Miscellaneous Expense	5,090
	1,212,340	1,212,340

Required:

1. Prepare an income statement.

Gorman Group Income Statement For the Year Ended October 31, 2019
Revenues:
	$
Total revenues		$
Expenses:
	$
Total expenses
Net income		$

Prepare a statement of owner's equity (no additional investments were made during the year.)

Gorman Group Statement of Owner's Equity For the Year Ended October 31, 2019
		$
	$
		$

Prepare a balance sheet.

Gorman Group Balance Sheet October 31, 2019
Assets				Liabilities
Current assets:				Current liabilities:
		$			$
				Total liabilities		$
Total current assets			$
Property, plant, and equipment:				Owner's Equity
	$
Total property, plant, and building
Total assets			$	Total liabilities and owner's equity		$

2. Journalize the entries that were required to close the accounts at October 31. For a compound transaction, if an amount box does not require an entry, leave it blank.

Date	Account	Debit	Credit
Oct. 31
Oct. 31

3. If the balance of Nicole Gorman, Capital had instead increased $115,000 after the closing entries were posted and the withdrawals remained the same, what would have been the amount of net income or net loss? $

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