Three accounting quizzes

Quiz 1 Denise’s Cleaning Services

Denise’s Cleaning Services has been operating for 5 years. At December 31 of last year, the accounting records reflected the following:

Assets	Amount	Liabilities & Equity	Amount
Cash	$ 23,000	Accounts Payable	$ 20,000
Marketable Securities	2,000	Notes Payable (Short-Term)	8,000
Accounts Receivable	5,000	Long Term Notes Payable	47,000
Equipment	50,000	Common Stock	10,000
Factory	90,000	Additional Paid in Capital	60,000
Intangibles	5,000	Retained Earnings	30,000
Total Assets	$175,000	Total Liabilities & Equity	$175,000

During the current year, the company had the following summarized activities:

a. Purchased furniture for $13,000 cash.

b. Purchase supplies on account for $3,000.

c. Purchased equipment that cost a total of $29,000; paid $5,000 cash and signed a one-year note for the balance.

d. Hired a new president at the end of the year. The contract was for $60,000 per year plus options to purchase company stock at a set price based on company performance.

e. Issued additional shares of common stock for $5,000 cash and $15,000 in equipment.

f. Borrowed $48,000 cash as a two-year note payable from a local bank.

g. Purchased Land for $40,000 cash.

h. Performed Services for a customer and received $15,000 cash.

i. Built an addition to the factory for a total cost of $45,000; paid $9,000 in cash and signed a three-year note for the balance.

j. Performed services for a customer on account for $12,600.

k. Paid $5,200 on account.

l. Received $3,100 from a customer on account.

m. Paid expenses: Rent-$1,500 and Salaries-$4,000

n. Paid dividends $2,000.

Required

1. Create a journal entry for each transaction.

2. Prepare a trial balance as of December 31 of the current year.

3. Prepare an Income Statement of December 31 of the current year.

4. Prepare a Statement of Retained Earnings as of December 31, of the current year.

5. Prepare a Balance Sheet as of December 31, of the current year.

6. Analyze the financial status of the company over this last year. (Don’t forget to use ratios.)