Question

Required information The following information applies to the questions displayed below.] Penny Cassidy is considering forming her own pool service and supply company, Penny's Pool Service & Supply, Inc. (PPSS). She has decided to incorporate the business to limit her legal liability. She expects to invest $31,000 of her own savings and receive 2,000 shares of common stock. Her plan for the first year of operations forecasts the following amounts at December 31, the end of the current year: Cash in bank, $7,000; amounts due from customers for services rendered, $3,400; pool supplies inventory, $5,700; equipment, $29,100; amounts owed to Pool Corporation, Inc., a pool supply wholesaler, $4,600; note payable to the bank, $6,100. Penny forecasts first-year sales of $66,600, wages of $25,100, cost of supplies used $9,300, other administrative expenses of $5,600, and income tax expense of $5,100. She expects to pay herself a $18,000 dividend as the sole stockholder of the company. If Penny's estimates are correct, what would the following first-year financial statements look like for Penny's Pool Service & Supply, Inc.? 3. Prepare a balance sheet for the current year. X Answer is not complete. plete. PENNY'S POOL SERVICE & SUPPLY, INC. Balance Sheet $ Assets: Cash Accounts receivable Equipment Inventories 7,000 3,400V 29,100 5,700 $ 45,200 Total assets Liabilities: Accounts payable $ 4,600) Notes payable to banks o 6,100 10,700 Total liabilities Stockholders' Equity: Common stock Retained earnings 31,000 3,500 Total stockholders' equity Total liabilities and stockholders' equity 34,500 $ 45,200

Answer 1

Answer

• Requirement 3 is CORRECT, BUT INCOMPLETE because you did not select the ‘period’ label below BALANCE SHEET heading.
• It should be something like this:

PENNY's POOL SERVICE & SUPPLY, INC
Balance Sheet
“at December 31 “
Assets:
Cash…
(..and so on)

• You missed to select “at December 31”.