Problem 1

INCOME STATEMENT
Sales 787,500.00
Less : Salary Expense 275,000.00
Rent Expense 90,000.00
Taxes Expense 89,000.00
Advertising Expense 52,000.00
Utilities Expense 37,500.00
Insurance Expense 26,500.00
Supplies Expense 6,000.00
Miscellaneous Expense 9,250.00 585,250.00
Net Income 202,250.00

STATEMENT OF CHANGES IN OWNERS EQUITY

Gavino, Capital Beginning 130,250.00
Add : Net Income 202,250.00
Additional Investment - 202,250.00
Total 332,500.00
Less : Gavino, Withdrawal 180,000.00
Gavino, Capital End 152,500.00

BALANCE SHEET
ASSETS LIABILITIES & CAPITAL
Current Assets LIABILITIES

Cash 62,500.00 Current Liabilities

Accounts Receivable 92,500.00 Accounts Payable 12,500.00
Supplies 9,000.00 Salaries Payable 6,000.00
Prepaid Insurance 7,000.00 Total Liabilities 18,500.00
TOTAL ASSETS 171,000.00
CAPITAL
Gavino, Capital 152,500.00
TOTAL LIABILITIES & CAPITAL 171,000.00
Problem 2

INCOME STATEMENT
Sales 972,250.00
Less : Advertising Expense 36,250.00
Insurance Expense 6,500.00
Rent Expense 133,200.00
Salaries Expense 401,000.00
Supplies Expense 18,400.00
Utilities Expense 56,200.00
Taxes Expense 12,300.00
Miscellaneous Expense 24,800.00 688,650.00
Net Income 283,600.00

STATEMENT OF CHANGES IN OWNERS EQUITY

Lane, Capital Beginning 400,000.00

Add : Net Income 283,600.00
Additional Investment 150,000.00 433,600.00
Total 833,600.00
Less : Lane, Withdrawal 200,000.00
Lane, Capital End 633,600.00

BALANCE SHEET

ASSETS LIABILITIES & CAPITAL

Current Assets LIABILITIES
Cash 104,200.00 Current Liabilities
Accounts Receivable 194,850.00 Accounts Payable 12,050.00
Prepaid Insurance 14,500.00 Note Payable 50,000.00
Supplies 12,250.00 Salaries Payable 5,150.00
Total Current Assets 325,800.00 Total Liabilities 67,200.00
Non - Current Assets CAPITAL
Land 375,000.00 Lane, Capital 633,600.00
TOTAL ASSETS 700,800.00 TOTAL LIABILITIES & CAPITAL 700,800.00
Problem 3
INCOME STATEMENT
Bowling Revenue 47,600.00
Less : Salaries & Wages Expense 20,725.00
Advertising Expense 2,450.00
Utilities Expense 2,210.00
Repairs Expense 790.00
Miscellaneous Expense 965.00 27,140.00
Net Income 20,460.00

STATEMENT OF CHANGES IN OWNERS EQUITY

Espinosa, Capital Beginning 150,000.00
Add : Net Income 20,460.00
Additional Investment 74,380.00 94,840.00
Total 244,840.00
Less : Espinosa, Withdrawal 3,000.00
Espinosa, Capital End 241,840.00

BALANCE SHEET

ASSETS LIABILITIES & CAPITAL

Current Assets LIABILITIES

Cash 5,135.00 Current Liabilities

Prepaid Insurance 1,720.00 Accounts Payable 3,750.00
Supplies 1,435.00 Total Liabilities 3,750.00
Total Current Assets 8,290.00
Non - Current Assets CAPITAL
Land 25,000.00 Espinosa, Capital 241,840.00
Building 135,000.00 TOTAL LIABILITIES & CAPITAL 245,590.00
Less : Accu. Depreciatiion - Bldg. 36,200.00 98,800.00
Equpment 145,000.00
Less : Accu. Depreciation-Eqpt. 31,500.00 113,500.00
Non - Current Assets 237,300.00
TOTAL ASSETS 245,590.00
Problem 4
INCOME STATEMENT
Sales 782,500.00
Less : Advertising Expense 23,500.00
Sales Salaries Expense 64,000.00
Office Salaries Expense 28,500.00
Rent Expense 28,400.00
Light & Water Expense 11,800.00
Taxes & Licenses 13,000.00
Insurance Expense 1,250.00
Miscellaneous Selling Expense 7,550.00 178,000.00
Net Income 604,500.00

STATEMENT OF CHANGES IN OWNERS EQUITY

Carlos Vila, Capital Beginning 100,000.00

Add : Net Income 604,500.00
Additional Investment 75,640.00 680,140.00
Total 780,140.00
Less : Carlos Villa, Withdrawal 40,000.00
Carlos Villa, Capital End 740,140.00

BALANCE SHEET
ASSETS LIABILITIES & CAPITAL
Current Assets LIABILITIES
Cash 921,250.00 Current Liabilities
Account Receivable 75,600.00 Accounts Payable 27,210.00
Merchandise Inventory 106,800.00 Salaries Payable 505,000.00
Store Supplies 13,300.00 Total Liabilities 532,210.00
Prepaid Insurance 12,500.00
Total Current Assets 1,129,450.00
 Non - Current Assets CAPITAL
Store Equipment 57,100.00 Carlos Vila, Capital 740,140.00
Less : Accu. Depreciatiion - Store Eqpt. 14,400.00 42,700.00 TOTAL LIABILITIES & CAPITAL 1,272,350.00
Office Equipment 55,000.00
Less : Accu. Depreciation- Office Eqpt. 10,500.00 44,500.00
Furniture & Fixture 59,800.00
Less : Accu. Depreciation- F & F 9,800.00 50,000.00
Intangible 5,700.00
Non - Current Assets 142,900.00
TOTAL ASSETS 1,272,350.00

Problem 5
INCOME STATEMENT
Professional Income 738,700.00
Less : Rent Expense 9,250.00
Utilities Expense 16,500.00
Salaries Expense 73,500.00
Office Supplies Used 80,000.00
Repairs & Maintenance 95,000.00
Delivery Expense 72,500.00
Interest Expense 89,000.00
Selling Expense 98,700.00
Depreciation Expense 95,000.00
Insurance Expense 75,000.00 704,450.00
Net Income 34,250.00

STATEMENT OF CHANGES IN OWNERS EQUITY

Corbin, Capital Beginning 100,000.00

Add : Net Income 34,250.00
Additional Investment 66,700.00 100,950.00
Total 200,950.00
Less : Corbin, Withdrawal 95,000.00
Corbin, Capital End 105,950.00
BALANCE SHEET
ASSETS LIABILITIES & CAPITAL
Current Assets LIABILITIES

Cash 42,500.00 Current Liabilities

Accounts Receivable 89,750.00 Accounts Payable 69,950.00
Less : Allowances for bad debts 8,950.00 80,800.00 Accrued Payable 10,000.00
Merchandise Invenrory 132,000.00 Salaries Payable 6,150.00
Prepaid Insurance 8,700.00 Total Current Liabilities 86,100.00
Office Supplies 7,350.00
Total Current Assets 271,350.00 Non- Current Liabilities

Non - Current Assets Note Payable - long - term 78,200.00

Mortgage Payable 80,000.00
Store Equipment 91,100.00 Current Non- Current Liabilities 158,200.00
Less : Accu. Depreciatiion - Store Eqpt. 38,400.00 52,700.00 TOTAL LIABILITIES 244,300.00
Office Equipment 48,750.00
Less : Accu. Depreciation- Office Eqpt. 22,550.00 26,200.00 CAPITAL
Total Non - Current Assets 78,900.00 Corbin, Capital 105,950.00
TOTAL ASSETS 350,250.00 TOTAL LIABILITIES & CAPITAL 350,250.00