Chapter 7
Corporations: The Financial Statements
335
AP-8A (
2
3
)
Below is the adjusted trial balance for Simple Town Corporation. The balance of retained
earnings represents the balance at the beginning of the fiscal year. The company decided not
to pay dividends this year.
Simple Town Corporation
Adjusted Trial Balance
June 30, 2016
Debit
Credit
Cash
$78,000
Accounts Receivable
93,000
Prepaid Rent
7,800
Inventory
195,000
Notes Receivable
35,000
Furniture
120,000
Accumulated Depreciation
$42,000
Accounts Payable
24,000
Unearned Revenue
22,500
Interest Payable
6,800
Salaries Payable
18,000
Loan Payable
80,000
Preferred Shares
25,800
Common Shares
105,000
Retained Earnings (beginning balance)
171,290
Sales Revenue
300,000
Net Change in Fair Value of Investments
2,800
Sales Returns and Allowances
12,000
Cost of Goods Sold
60,000
Depreciation Expense
12,600
Salaries Expense
69,000
Rent Expense
16,500
Utilities Expense
19,500
Insurance Expense
23,400
Supplies Expense
36,000
Income Tax Expense
17,990
Loss on Disposal of Equipment
2,400
Total
$798,190
$798,190
