The following is a random list of accounts taken from the adjusted trial balance

Question

The following is a random list of accounts taken from the adjusted trial balance of Grove Company at December 31, 2016: Accounts Payable Accounts Receivable Accumulated Depreciation- Equipment Bonds Payable (all long term) Cash Common Stock Cost of Goods Sold Depreciation Expense Dividends Equipment Interest Expense Land Retained Earnings, January 1,2016 Salaries Expense Sales Revenue Income Tax Expense $18,500 4,000 4,800 18,000 24,000 25,000 13,000 4,800 5,300 48,000 2,500 7,500 16,000 5,200 36,500 4,500 a) Prepare the statement of retained earnings, balance sheet, and income statement for the year ended December 31, 2016. Pay attention to the order you prepare the statements. All statements need proper headings. I need to be able to read them, so be neat also. f 1 Prepare the first statement here 2

Explanation / Answer

Solution:

Income Statement - Grove Company For the year ended December 31, 2016 Particulars Amount Sales revenue $36,500.00 Cost of goods sold $13,000.00 Gross Profit $23,500.00 Operating Expenses: Depreciation expense $4,800.00 Salaries Expense $5,200.00 Operaing income (EBIT) $13,500.00 Interest Expense $2,500.00 Earning before taxes (EBT) $11,000.00 Income tax expense $4,500.00 Net Income $6,500.00

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