Q43PGA_c
Question
Picture Perfect Photography works weddings and prom-type parties. The balance of retained earnings was \(16,000 at December 31, 2017. At December 31, 2018, the business’s accounting records show these balances: Insurance Expense \) 6,000 Accounts Receivable $ 13,000 Cash 42,000 Notes Payable 14,000 Accounts Payable 11,000 Retained Earnings, Dec. 31, 2018 ? Advertising Expense 4,000 Salaries Expense 25,000 Service Revenue 75,000 Equipment 46,000 Dividends 8,000 Common Stock 28,000 Prepare the following financial statements for Picture Perfect Photography for the year ended December 31, 2018: a. Income statement. b. Statement of retained earnings. c. Balance sheet
Step-by-Step Solution
VerifiedPicture Perfect Photograph | ||||
Balance Sheet | ||||
December 31, 2018 | ||||
| Assets | Liabilities | |||
Cash | $42,000 | Accounts Payable | $11,000 | |
Accounts Receivable | 13,000 | Notes Payable | 14,000 | |
Equipment | 46,000 | Total Liabilities | 25,000 | |
|
| Stockholders’ Equity | ||
|
| Common Stock | 28,000 | |
|
| Retained Earnings | 48,000 | |
|
| Total Stockholders’ Equity | 76,000 | |
Total Assets | $101,000 | Total Liabilities and Stockholders’ Equity | $101,000 | |
Balance sheet reports the final balances of assets, liabilities, and stockholders’ equity at the end of particular accounting period.
In the balance sheet, total assets equals $101,000, total liabilities equals $25,000, and total stockholders’ equity equals $76,000.