205.Figgaro Company Inc.'s accounts and their balances, as of the end of August, are included below.

All accounts have no

Accounts receivable$36,000Cash$28,000
Common stock1,000
Equipment59,000Advertising expense5,000
Service revenues earned75,000Accounts payable31,000
Rent expense3,600Dividends24,000
Office supplies1,500Salaries expense30,000
Notes payable22,000Retained earnings58,100

a. Calculate net income.

b. Determine the amount of retained earnings to be shown on the August 31 balance sheet.  

206.Based on the following trial balance for Sally's Salon, Inc, prepare an income statement, statement of retained earnin

Sally’s Salon, Inc.

Trial Balance Balance Sheet
Dec-31 Assets Amount
Cash$7,500 Cash $ 7,500
Accounts receivable475 Accounts Receivable $ 475
Beauty supplies2,500 Beauty supplies $ 2,500
Beauty shop equipment17,000 Beauty shop equipment $ 17,000
Accounts payable $745 $ 27,475
Common stock  1,000
Retained earnings 21,155
Dividends36,000
Revenue earned 72,000
Beauty supplies expense3,425
Rent expense6,000
Wages expense 22,000
Totals$94,900$94,900

207.George Butler owned a tugboat and was tired of his current job. He decided to open a business, Butler, Inc., that prov

May 1 Butler invested $20,000 cash and his tugboat valued at $90,000 in the business.
May 2 Butler paid $3,000 cash for office equipment to help him keep track of business activities.
Date
May 3 Butler bought boating supplies costing $2,500 on credit. May-01
May 4 Butler paid the river master $500 cash for the first month’s dock rental.
May 5 Butler paid $1,800 cash for a six-month insurance policy.
May 10 Butler received $2,000 cash from clients for his first tour.
May 12 Butler provided a $3,500 tour on credit, the customer has agreed to pay within 10 days.May-02
May 19 Butler paid for the boating supplies originally purchased on May 3.
May 22 Butler receives payment on the account from the client entry on May 12.
May 25 Butler received $2,750 cash for additional tours. May-03
May 31 Butler paid his crew member a salary of $1,000.
May 31 The company paid $2,000 cash in dividends to the owner. (sole shareholder)
May-04

May-05

May-10

May-12

May-19

May-22

May-25

May-31

May-31
ed below. All accounts have normal balances:

Accounts Receivable 36000 Common stock 1000

Cash 28000 Accounts Payable 31000
Equipment 59000 Notes payable 22000
Office Supplies 1500 Retained Earning 70500
124500 124500
0

statement of retained earnings, and a balance sheet. Sally Crawford made no additional investments in the company during the yea

Liabilities & Capital Amount

Common Stock $ 1,000
Retained Earnings $ 25,730
Accounts payable $ 745

$ 27,475
Answer 206
Income Statement
Revenue earned $ 72,000
Beauty supplies expense $ 3,425
Rent expense $ 6,000
Wages expense $ 22,000
Total expenses $ 31,425
Net Income $ 40,575

business, Butler, Inc., that provides day tugboat tours to tourists along the Mississippi River near his hometown. Prepare journal entri

Answer 207
Accounts Title Debit Credit
Cash $ 20,000
Tugboat $ 90,000
George Butler's Capital $ 110,000

Office Equipment $ 3,000

Cash $ 3,000

Boating Supplies $ 2,500

Accounts Payable $ 2,500

Rent expense $ 500

Cash $ 500

Prepaid Insurance $ 1,800

Cash $ 1,800

Cash $ 2,000
Service Revenue $ 2,000

Accounts Receivable $ 3,500

Service Revenue $ 3,500

Accounts Payable $ 2,500

Cash $ 2,500

Cash $ 3,500
Accounts Receivable $ 3,500

Cash $ 2,750
Service Revenue $ 2,750

Salaries expense $ 1,000

Cash $ 1,000

Dividends $ 2,000
Cash $ 2,000
 Answer 205
Answer A
Income Statement
Service revenues earned $ 75,000
Rent expense $ 3,600
Advertising expense $ 5,000
Salaries expense $ 30,000
Total expenses $ 38,600
Net Income $ 36,400

Answer B
Statement of Retained Earnings
Beginning Balance $ 58,100
less: dividends $ 24,000
add: net income $ 36,400
Ending Balance $ 70,500
tional investments in the company during the year.

Statement of Retained Earnings

Beginning Balance $ 21,155
less: dividends $ 36,000
add: net income $ 40,575
Ending Balance $ 25,730

pi River near his hometown. Prepare journal entries to record the following transactions.