Prepare Income Statement and Balance Sheet for Safety Hire
What are the financial data for Safety Hire as of 30 June 2019?
Accounts receivable
Equipment hire income
Accounts payable
Michael Donato, capital
Cash at bank
Mortgage payable
Building
Wages expense
Advertising expense
Land
Hire equipment
Loan payable
Electricity expense
Telephone expense
Answer:
The financial data for Safety Hire as of 30 June 2019 are as follows:
Accounts receivable: $63,000
Equipment hire income: $170,000
Accounts payable: $40,000
Michael Donato, capital: Unknown
Cash at bank: $45,000
Mortgage payable: $130,000
Building: $85,000
Wages expense: $75,000
Advertising expense: $30,000
Land: $75,000
Hire equipment: $180,000
Loan payable: $50,000
Electricity expense: $18,000
Telephone expense: $7,500
To prepare the income statement for the month of June and a balance sheet in account format for Safety Hire as at 30 June 2019, we need to calculate the net income and total assets and liabilities based on the given financial data.
The income statement for the month of June 30, 2019 would look like this:
| Particulars | Amount ($) |
|---|---|
| Equipment hire income | $170,000 |
| Total income | $170,000 |
| Less: Expenses | |
| Wages expenses | $75,000 |
| Advertising Expense | $30,000 |
| Electricity | $18,000 |
| Telephone Expense | $7,500 |
| Total expenses | $130,500 |
| Net Income (Total Income - Total Expenses) | $39,500 |
The balance sheet in account format for Safety Hire as of 30 June 2019 would include the assets, liabilities, and capital based on the financial data provided. The capital amount for Michael Donato is still unknown and needs to be calculated to prepare the complete balance sheet.
With the given information, the preparation of the income statement and balance sheet requires proper analysis and calculation to present the financial position of Safety Hire accurately.