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Stacey's Piano Rebuilding Company has been operating for one year. At the start of the second year, its income statement accounts had zero balances and its balance sheet account balances were as follows: Cash Accounts receivable Supplies Equipment Land Building $ 6,500 30,500 1,520 9,900 7,500 27,300 Accounts payable Unearned revenue Long-term note payable Common stock Additional paid-in capital Retained earnings 9,600 3,140 47,700 200 800 21,780 a. Rebuilt and delivered five pianos in January to customers who paid $18,900 in cash. b. Received a $510 deposit from a customer who wanted her piano rebuilt. c. Rented a part of the building to a bicycle repair shop; received $870 for rent in January. d. Received $7,800 from customers as payment on their accounts. e. Received an electric and gas utility bill for $470 to be paid in February. f. Ordered $860 in supplies. g. Paid $1,640 on account in January. h. Received from the home of Stacey Eddy, the major shareholder, a $1,000 tool (equipment) to use in the business in exchange for 130 shares of $1 par value stock. i. Paid $14,900 in wages to employees who worked in January. j. Declared and paid a $2,100 dividend (reduce Retained Earnings and Cash). k. Received and paid cash for the supplies in (f).
Required: Prepare an unadjusted classified income statement for January of the second year (ignore income taxes). STACEY'S PIANO REBUILDING COMPANY Income Statement (unadjusted) For the Month Ended January 31 Operating revenues: Rebuilding fees revenue Total operating revenues Operating expenses: Wages expense Utilities expense Total operating expenses Operating income Other item: Rent revenue Net income $ 18,900 18,900 14,900 470 15,370 870 870
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