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29 October, 11:02

The December 31, 2018, adjusted trial balance for Fightin' Blue Hens Corporation is presented below. Accounts Debit CreditCash $10,000 Accounts Receivable 130,000 Prepaid Rent 4,000 Supplies 20,000 Equipment 200,000 Accumulated Depreciation $115,000Accounts Payable 10,000Salaries Payable 9,000Interest Payable 3,000Notes Payable (due in two years) 20,000Common stock 100,000Retained Earnings 40,000Service Revenue 300,000Salaries Expense 200,000 Rent Expense 10,000 Depreciation Expense 20,000 Interest Expense 3,000 Totals $597000 $597,0001. Prepare a statment of stockholder equity for the year ends Desember 31, 2018, assuming no common stock was issued during 2018.2. Prepare a classified blance sheet as of December 31, 2018.

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  1. 29 October, 11:07
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    These can be prepared as shown below:

    Explanation:

    1. Prepare a statement of stockholder equity for the year ends December 31, 2018, assuming no common stock was issued during 2018.

    To do this, the income statement is first prepared by ignoring tax as follows:

    Fightin' Blue Hens Corporation

    Income Statement

    for the year ended December 31, 2018.

    Details $

    Service Revenue 300,000

    Salaries Expense (200,000)

    Rent Expense (10,000)

    Depreciation Expense (20,000)

    Interest Expense (3,000)

    Earnings for the year 67,000

    Therefore, we have:

    Fightin' Blue Hens Corporation

    Statement of Stockholder Equity

    for the year ends December 31, 2018

    Details $

    Common stock 100,000

    Retained Earnings 40,000

    Earnings for the year 67,000

    Stockholder Equity 207,000

    2. Prepare a classified balance sheet as of December 31, 2018.

    A balance sheet is a balance sheet that have different classifications suchas fixed assets, current assets and liabilities, long-term liabilities, and stockholder equity. This can be prepared as follows:

    Fightin' Blue Hens Corporation

    Classified Balance Sheet

    for the year ends December 31, 2018

    Details $ $

    Fixed Assets

    Equipment 200,000

    Accumulated Depreciation (115,000)

    Net Fixed Assets 85,000

    Current Assets

    Cash 10,000

    Accounts Receivable 130,000

    Prepaid Rent 4,000

    Supplies 20,000

    Total current assets 164,000

    Current Liabilities

    Accounts Payable (10,000)

    Salaries Payable (9,000)

    Interest Payable (3,000)

    Working capital 142,000

    Long-term Liabilities

    Notes Payable (due in two years) (20,000)

    Net Total Assets 207,000

    Financed by:

    Common stock 100,000

    Retained Earnings 40,000

    Earnings for the year 67,000

    Stockholder Equity 207,000

    Note: When a balance sheet is accurately prepared, the net total assets and the stockholder equity must be equal as above with both equaling $207,000.
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