QUESTION 1 Use the following Information to answer the next 5 questions The foll

Question

QUESTION 1 Use the following Information to answer the next 5 questions The following balances were taken from the ADJUSTED TRIAL BALANCE of SAM Corp. for the fiscal year ending December 31, 2008. 40,000Accounts Receivable 17,500 45,000 Prepaid Rent 5,500 5,000 1,000 55,000 1,500 20,000 1,000 Equipment Accounts Payable Wages Payable Retained Earnings, 1/1/2008 Interest Payable 2,000 6,000 40,000 3,000 17,000 Notes Payable, Due 5/1/2011 Interest Expense Rent Expense Wages Expense Uneaned Service Revenue 2,000 3,500 Each of these accounts has the normal debit or credit balance. (HINT: do a complete set of financial statements before The Adjusted Trial Balance has a total DEBIT balance of O $129,000 O $132,000 O$134,000 $129,000 answering the questions.) None of the above QUESTION2 The NET INCOME for the year is

Explanation / Answer

Adjusted trial balance :

1) Total debit balance = $134000

So answer is c) $134000

2) Net income = 15500

So answer is b) $15500

3) Total owner's equity = 55000+6000-1500+15500 = 75000

So answer is b) $75000

4) Total liabilities on balance sheet = 3000+1000+2000+2000+20000 = 28000

So answer is c) $28000

5) Total assets = 40000+17500+5500+45000-5000 = 103000

So answer is b) $103000

Debit Credit Cash 40000 Account receivable 17500 Prepaid rent 5500 Equipment 45000 Accumlated depreciation-Equipment 5000 Account payable 3000 Interest payable 1000 Wages payable 2000 Unearned service revenue 2000 Notes payable 20000 Common Stock 55000 Retained earnings 6000 Dividend 1500 Service revenue 40000 Rent expense 3000 Wages expense 17000 Interest expense 1000 Depreciation expense-Equipment 3500 Total 134000 134000

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