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the trial balance for a company that sells alarms as of January 1 2016 had the following balances Cash 74000 Accounts receivable 13000 Supplies 200 Prepaid rent

  1. he trial balance for a company that sells alarms, as of January 1, 2016 had the following balances: (24 points)

 

Cash 74,000

Accounts receivable 13,000

Supplies 200

Prepaid rent 3,200

Merchandise inventory (24 @ $200; 1 @ $200) 5,000

Land 4000

Accounts payable 1,900

Unearned revenue 900

Salaries payable 1,000

Common stock 50,000

Retained earnings 47,000

 

The following transactions took place during 2016:

1. Paid the salaries payable from 2015.

2. Paid $4,800 on May 1, 2016, for one year's lease on the company van in advance.

3. Paid $7,200 on May 2,2016 for one year's office rent in advance.

4. Purchased $400 of supplies on account.

5. Purchased 100 alarm systems for $28,000 cash during the year.

6. Sold 102 alarm systems for $57,000. All sales were on account.

(Compute cost of goods sold using the FIFO cost flow method)

7. Paid $2,100 on accounts payable during the year.

8. Billed $52,000 of monitoring services for the year.

9. Paid installers and other employees a total of $25,000 cash for salaries.

10. Collected $89,000 of accounts receivable during the year.

11. Paid $3,600 of advertising expense during the year.

12. Paid $2,500 of utilities expense for the year.

13. Paid a dividend of $10,000 to the shareholders.

 

Required:

1. Prepare the trial balance as at Dec 31, 2016 for the company

2. Prepare the income statement and balance sheet for the company.

May 09 2020 View more View Less

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