Drill 7-D1
Preparing an Income Statement
From the work sheet below, prepare an income statement for The Sound of Stone.
INSTRUCTIONS:
Complete the following.
1. Total all columns of the work sheet
2. Calculate and record the amount of net income or net loss.
3. Using the form on the next page, prepare an income statement for the month ended
September 30, 20--.
4. Calculate and record the component percentages for total expenses and net income.
Round percentages to the nearest 0.1%
1
2
Trial Balance
Account Title
1. Cash
2. Petty Cash
3. Accts. Rec.—HartCo
4. Accts. Rec.—Starlite Club
5. Supplies
6. Prepaid Insurance
7. Accts. Pay.—First Audio
8. Accts. Pay.—Office Supply Co.
9. Shannon Stone, Capital
10. Shannon Stone, Drawing
11. Income Summary
12. Sales
13. Advertising Expense
14. Insurance Expense
15. Miscellaneous Expense
16. Rent Expense
17. Supplies Expense
18. Utilities Expense
20.
Debit
Credit
3
4
Adjustments
Debit
8,272
200
100
720
4,051
1,200
Credit
5
6
Income
Statement
Debit
Credit
7
Debit
Credit
8,272
200
100
720
1,487
1,100
2,564
100
1,360
20
10,000
1,360
20
10,000
600
600
4,411
4,411
273
100
10
250
2,564
115
8
Balance Sheet
273
100
10
250
2,564
115
Drill 7-D1
Preparing an Income Statement (continued)
The Sound of Stone
Income Statement
For the Month Ended September 30, 20- % of
Sales
Revenue:
Sales
Expenses:
Advertising Expense
Insurance Expense
Miscellaneous Expense
Rent Expense
Supplies Expense
Utilities Expense
Total Expenses
Net Income
Drill 7-D2
Preparing a balance sheet
INSTRUCTIONS:
From the work sheet in Drill 7-D1, prepare the September 30, 20-- balance sheet for The Sound
of Stone using the form below.
Assets
Liabilities