>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...
icon
Related questions
Question
Question: Decision Case 3-1 One year ago, Tyler Stasney founded Swift Classified Ads. Stasney
>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.
CHAPTER 3
3-64
Financial
Cash
Dec. 31 5,800
chapter 3
Common Stock
Accounts Payable
Salaries Expense
21,500 Dec. 31
20,000 Dec. 31
Dec. 31 17,000
Depreciation
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
Office Supplies
Jan. 2
2,600
Jan. 2
Equipment
36,000
Accumulated
Depreciation-Equipment
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.
Transcribed Image Text:>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. CHAPTER 3 3-64 Financial Cash Dec. 31 5,800 chapter 3 Common Stock Accounts Payable Salaries Expense 21,500 Dec. 31 20,000 Dec. 31 Dec. 31 17,000 Depreciation 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 Office Supplies Jan. 2 2,600 Jan. 2 Equipment 36,000 Accumulated Depreciation-Equipment 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.
Expert Solution
steps

Step by step

Solved in 3 steps with 2 images

Blurred answer
Knowledge Booster
Basic Accounting Terms
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
College Accounting (Book Only): A Career Approach
College Accounting (Book Only): A Career Approach
Accounting
ISBN:
9781337280570
Author:
Scott, Cathy J.
Publisher:
South-Western College Pub