Question

Tiffany's provides financial services related to investment selections, retirement planning, and general insurance needs. For the current year, the company reports the following amounts: $33,400 Service Revenue $127,100 Advertising Expense Buildings 149,000 Interest Expense 3,400 Salaries Expense 65,000 Utilities Expense 15,400 Accounts Payable 6,300 Equipment 26,500 Cash 5,400 Notes Payable 29,500 In addition, the company had common stock of $110,000 at the beginning of the year and issued an additional $10,000 during the year. The company also had retained earnings of $20,300 at the beginning of the year and paid dividends of $5,100. Required: Prepare the income statement, statement of stockholders' equity, and balance sheet for Tiffany's for the year ended December 31.

Answer 1

Income Statement;

Tiffany Inc Income Statement For the year ended December 31, 20XX Service Revenue $ 127,100 Total Revenue $ 127,100 Expenses: Salaries Expense $ 65,000 Advertising Expense $ 33,400 Interest Expense $ 3,400 Utilities Expense $ 15,400 1 Total expense $ 117,200 2 Net Income $ 9,900 (127,100 - 117,200)

Statement of Stockholders Equity:

Tiffany Inc. Statement of Stockholders Equity For the year ended December 31, 20XX Total Common Stockholders Stock Retained Earnings Equity Balance on January 1 $ 110,000 $ 20,300 $ 130,300 Add: Issue of Shares $ 10,000 10,000 Add: Net Income $ 9,900 $ 9,900 Less: Cash Dividends $ (5,100) $ (5,100) Balance on December 31 $ 120,000 $ 25,100 145,100

Balance Sheet:

Tiffany Inc Balance Sheet On December 31, 20XX Amounts Current Assets Cash Total Current Assets $ $ 5,400 5,400 $ Property, Plant and Equipment Building Equipment Total Property, plant and Equipment 149,000 26,500 $ 175,500 Total Assets $ 180,900 (5,400 + 175,500)

Liabilities and Stockholders' Equity Current Liabilities Accounts payable Notes payable Total current liabilities 6,300 29,500 35,800 Total liabilities 35,800 Stockholders' equity Common stock Retained earnings Total stockholders equity Total liabilities and stockholders $ $ $ 120,000 25,100 145,100 $ 180,900 (35,800 + 145,100)