Figgaro Company's Accounts and Their Balances, as of the End

question 64

Essay

Figgaro Company's accounts and their balances, as of the end of August, are included below. All accounts have normal balances:
Accounts receivable $36,000 Cash $27,000
Equipment 59,000 Advertising expense 5,000
Service revenues earned. 75,000 Accounts payable 31,000
Rent expense 3,600 Dividends 24,000
Office supplies 1,500 Salaries expense 30,000
Notes payable 22,000 Common Stock 58,100
a. Calculate net income.
b. Determine the amount of total equity to be shown on the August 31 balance sheet.

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Definitions:

Financial Statement

A written record that conveys the financial activities and conditions of a business or individual.

Normal Balance

The side (debit or credit) of an account that increases its value, reflecting the conventional balance based on accounting rules.

Financial Statements

Documents that give an overview of a business's financial condition in both short and long term, including but not limited to, income statements, balance sheets, and statements of cash flows.

Worksheet

A worksheet is often a piece of paper or a digital document used by accountants to prepare adjustments and end-of-period financial statements.