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Q 49PGB-3

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Horngren'S Financial And Managerial Accounting
Found in: Page 49

Short Answer

Presented here are the accounts of Pembroke Bookkeeping Company for the year ended December 31, 2018: Land $ 10,000 Common Stock $ 29,000 Notes Payable 31,000 Accounts Payable 7,000 Property Tax Expense 3,100 Accounts Receivable 1,200 Dividends 28,000 Advertising Expense 12,000 Rent Expense 7,000 Building 147,400 Salaries Expense 64,000 Cash 2,800 Salaries Payable 800 Equipment 15,000 Service Revenue 192,000 Insurance Expense 1,700 Office Supplies 12,000 Interest Expense 6,600 Retained Earnings, Dec. 31, 2017 51,000 Requirements 1. Prepare Pembroke Bookkeeping Company’s income statement. 2. Prepare the statement of retained earnings. 3. Prepare the balance sheet.

Pembroke Bookkeeping Company

Balance Sheet

December 31, 2018

Assets

Liabilities

Cash

$2,800

Accounts Payable

$7,000

Office Supplies

12,000

Notes Payable

31,000

Accounts Receivable

1,200

Salaries Payable

800

Equipment

15,000

Total Liabilities

38,800

Land

10,000

Stockholders’ Equity

Building

147,400

Common Stock

29,000

Retained Earnings

120,600

Total Stockholders’ Equity

149,600

Total Assets

$188,400

Total Liabilities and Stockholders’ Equity

$188,400

See the step by step solution

Step by Step Solution

Step-by-Step SolutionStep 1: Explanation on Balance Sheet

Balance sheet reports the ending balances of assets, liabilities, and owners’ equity for the particular accounting period.

Step 2: Details of balance sheet

In the balance sheet, total assets equals $188,400, total liabilities equals $38,800, and total stockholders’ equity equals $149,600.

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