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Mint Cleaning Inc. prepared the following unadjusted trial balance at the end of its second...

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Accounting

Mint Cleaning Inc. prepared the following unadjusted trial balance at the end of its second year of operations ending December 31.

Account Titles Debit Credit
Cash $ 55
Accounts Receivable 4
Prepaid Insurance 7
Equipment 114
Accumulated Depreciation $ 0
Accounts Payable 4
Common Stock 110
Retained Earnings 14
Sales Revenue 122
Insurance Expense 0
Salaries and Wages Expense 27
Supplies Expense 43
Totals $ 250 $ 250

Other data not yet recorded at December 31:
a. Insurance expired during the year, $5.
b. Depreciation expense for the year, $4.
c. Wages payable, $7.
d.

Income tax expense, $9.

By what amount would net income have been understated or overstated had the adjusting journal entries not been recorded?

Required:

Using the above adjusted balances, prepare an income statement.
Required:

Using the above adjusted balances, prepare a statement of retained earnings.

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