>Decision Case F:3-1 One year ago, Tyler Stasney founded Swift Classified Ads. Stasney remembers that you took an accounting course while in college and comes to you for advice. He wishes to know how much net income his business earned during the past year in order to decide whether to keep the company going. His accounting records consist of the T-accounts from his ledger, which were prepared by an accountant who moved to another city. The ledger at December 31 follows. The accounts have not been adjusted. 3-64 Financial chapter 3 CHAPTER 3 Cash Dec. 31 5,800 Accounts Payable Common Stock Salaries Expense 21,500 Dec. 31 20,000 Dec. 31 Dec. 31 17,000 Accounts Receivable Dec. 31 12,000 Unearned Revenue Dividends 4,000 Dec. 31 Dec. 31 28,000 Jan. 2 Prepaid Rent 2,800 Salaries Payable Service Revenue 59,500 Dec. 31 Jan. 2 Jan. 2 Office Supplies 2,600 Equipment 36,000 Accumulated Depreciation-Equipment Depreciation Expense Equipment Rent Expense Utilities Expense 800 Dec. 31 Supplies Expense Stasney indicates that at year-end, customers owe the business $1,600 for accrued service revenue. These revenues have not been recorded. During the year, wift Classified Ads collected $4,000 service revenue in advance from customers, but the business earned only $900 of that amount. Rent expense for the year was $2,400, and the business used up $1,700 of the supplies. Swift determines that depreciation on its equipment was $5,000 for the year. At December 31, the business owes an employee $1,200 accrued salary, Help Swift Classified Ads compute its net income for the year. Advise Stasney whether to continue operating Swift Classified Ads.
>Decision Case F:3-1 One year ago, Tyler Stasney founded Swift Classified Ads. Stasney remembers that you took an accounting course while in college and comes to you for advice. He wishes to know how much net income his business earned during the past year in order to decide whether to keep the company going. His accounting records consist of the T-accounts from his ledger, which were prepared by an accountant who moved to another city. The ledger at December 31 follows. The accounts have not been adjusted. 3-64 Financial chapter 3 CHAPTER 3 Cash Dec. 31 5,800 Accounts Payable Common Stock Salaries Expense 21,500 Dec. 31 20,000 Dec. 31 Dec. 31 17,000 Accounts Receivable Dec. 31 12,000 Unearned Revenue Dividends 4,000 Dec. 31 Dec. 31 28,000 Jan. 2 Prepaid Rent 2,800 Salaries Payable Service Revenue 59,500 Dec. 31 Jan. 2 Jan. 2 Office Supplies 2,600 Equipment 36,000 Accumulated Depreciation-Equipment Depreciation Expense Equipment Rent Expense Utilities Expense 800 Dec. 31 Supplies Expense Stasney indicates that at year-end, customers owe the business $1,600 for accrued service revenue. These revenues have not been recorded. During the year, wift Classified Ads collected $4,000 service revenue in advance from customers, but the business earned only $900 of that amount. Rent expense for the year was $2,400, and the business used up $1,700 of the supplies. Swift determines that depreciation on its equipment was $5,000 for the year. At December 31, the business owes an employee $1,200 accrued salary, Help Swift Classified Ads compute its net income for the year. Advise Stasney whether to continue operating Swift Classified Ads.
College Accounting (Book Only): A Career Approach
13th Edition
ISBN:9781337280570
Author:Scott, Cathy J.
Publisher:Scott, Cathy J.
Chapter3: The General Journal And The General Ledger
Section: Chapter Questions
Problem 4A: What Would You Do?
You are responsible for preparing all of the journal entries for Regional...
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Question: Decision Case 3-1 One year ago, Tyler Stasney founded Swift Classified Ads. Stasney
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