Question

The End of the Accounting Cycle – prepare the financial statements: The adjusted trial balance for Scoops Ahoy, Inc. as of July, 2020 is given below:

Scoops Ahoy
Adjusted Trial Balance
As of 7/31/2020
Account:	DEBIT:	CREDIT:
Cash	$        61,080
Accounts Receivable	$        59,111
Inventory	$        50,354
Equipment	$        90,240
Accumulated Depreciation - Equipment		$        9,024
Land	$        11,440
Goodwill	$        68,707
Accounts Payable		$      44,819
Wages Payable		$        8,420
Utilities Payable		$           930
Interest Payable		$           820
Notes Payable		$      95,000
Common Stock		$        6,530
Additional Paid-In Capital		$      38,648
Retained Earnings		$    119,399
Sales Revenue		$    179,817
Cost of Goods Sold (COGS)	$        84,524
Wages Expense	$        65,107
Utilities Expense	$          1,980
Interest Expense	$             820
Depreciation Expense	$          4,512
Rent Expense	$          5,044
Dividends	$             488
	$      503,407	$    503,407

Using the adjusted trial balance provided above for Scoops Ahoy, prepare the following financial statements for July:

PART A: Income statement for the period ended July 31^st, 2020.

PART B : Classified balance sheet as of July 31^st, 2020.   Assume during 2020 no additional stock was issued and $488 in dividends were declared and paid in cash.

Answer 1

Part A:

Scoops Ahoy
Income Statement
As of 7/31/2020
Revenues
Sales revenue		$ 179,817
Expenses:
Cost of goods sold	$ 84,524
Wages Expense	$ 65,107
Utilities Expense	$ 1,980
Interest Expense	$ 820
Depreciation Expense	$ 4,512
Rent Expense	$ 5,044
Total Expenses		$ 161,987
Net income		$ 17,830

Statement of Retained earnings
Retained earnings, beginning	$ 119,399
Add: Net income	$ 17,830
Less: Dividends	($ 488)
Retained earnings, Ending	$ 136,741

Part B:

Scoops Ahoy
Classified Balance Sheet
at December 31, 2020
Assets			Liabilities and Stockholders' equity
Current Assets:			Current liabilities:
Cash	$ 61,080		Accounts payable	$ 44,819
Accounts receivable	$ 59,111		Wages payable	$ 8,420
Inventory	$ 50,354		Utilities payable	$ 930
Total current assets		$ 170,545	Interest payable	$ 820
Property, plant and equipment:			Total current liabilities		$ 54,989
Equipment	$ 90,240		Long-term liabilities:
Less: Accumulated depreciation-equipment	($ 9,024)		Notes payable	$ 95,000
Land	$ 11,440		Total long-term liabilities		$ 95,000
Total property, plant and equipment		$ 92,656	Total liabilities		$ 149,989
Intangible assets:			Stockholders' equity:
Goodwill		$ 68,707	Common stock	$ 6,530
			Additional paid-in Capital	$ 38,648
			Retained earnings	$ 136,741
			Total stockholders' equity		$ 181,919
Total Assets		$ 331,908	Total liabilities and stockholders' equity		$ 331,908