Q23E - Intermediate Accounting (Kieso)

Question

Jurassic Park Co. prepares monthly financial statements from a worksheet. Selected portions of the January worksheet showed the following data.

JURASSIC PARK CO.  Worksheet (PARTIAL)  For The Month Ended Jan. 31, 2017
	Trial  Balance		Adjustment		Adjusted   trial balance
Account Titles	Dr.	Cr.	Dr.	Cr.	Dr.	Cr.
Supplies	3,256			a) 1,500	1,756
Accumulated Depreciation—Equipment		6,682		(b) 257		6,939
Interest Payable				(c) 50		150
Supplies Expense			(a) 1,500		1,500
Depreciation Expense			(b) 257		257
Interest Expense			(c) 50		50

 

During February, no events occurred that affected these accounts. But at the end of February, the following information was available.

1. Supplies on hand \(715
2. Monthly depreciation            \)257
3. Accrued interest                     $ 50

Instructions 

Reproduce the data that would appear in the February worksheet, and indicate the amounts that would be shown in the February income statement.

Step-by-Step Solution

Answer

Worksheet is prepared in step 2. 

The following accounts and amounts would be shown in the February Income statement:

• Supplies expense $1,041
• Depreciation expense $257
• Interest expense $50

Step 1: Meaning of Financial statements

The income statement, also known as a profit and loss statement, is a record made by the management of a company that records the company's income, expenses, and net gain or loss for a specific period.

Step 2: Reproducing the data that would appear in the February worksheet and indicated in the income statement

 

 

JURASSIC PARK CO.                                                       Worksheet (PARTIAL)                                            For The Month Ended February 2017
	Trial Balance		Adjustment		Adjusted trial balance		Income  statement		Balance  Sheet
Account Titles	Dr.	Cr.	Dr.	Cr.	Dr.	Cr.	Dr.	Cr.	Dr.	Cr.
Supplies	1,756			(a) 1,041	715				715
Accumulated Depreciation—Equipment		6,939		(b) 257		7,196				7,196
Interest Payable		150		(c) 50		200				200
Supplies Expense			(a) 1,041		1,041		1,041
Depreciation Expense			(b) 257		257		257
Interest Expense			(c) 50		50		50