Financial Statements The transactions and integrated financial statement framework for Terry Mason f

Financial Statements

The transactions and integrated financial statement framework for Terry Mason for February 20Y4 appear below:

Terry Mason organized The Fifth Season at the beginning of February 20Y4. During February, The Fifth Season entered into the following transactions: Terry Mason invested $26,250 in The Fifth Season in exchange for capital stock. Paid $5,250 on February 1 for an insurance premium on a 1-year policy. Purchased supplies on account, $2,640. Received fees of $60,575 during February. Paid expenses as follows: wages, $22,200; rent, $3,700; utilities, $1,850; and miscellaneous, $2,035. Paid dividends of $9,660.

There was $2,244 of supplies on hand as of February 28. Statement of Cash Flows Balance Sheet Assets = Liabilities + Stockholders' Equity Cash + Supplies + Prepaid Insurance = Accounts Payable + Common Stock + Retained Earnings a. Investment 26,250 26,250 b. Paid insurance –5,250 5,250     Balances 21,000 5,250 26,250 c. Purchased supplies 2,640 2,640     Balances 21,000 2,640 5,250 2,640 26,250 d. Fees earned 60,575 60,575     Balances 81,575 2,640 5,250 2,640 26,250 60,575 e. Paid expenses –29,785 –29,785     Balances 51,790 2,640 5,250 2,640 26,250 30,790 f. Paid dividends -9,660 -9,660     Balances 42,130 2,640 5,250 2,640 26,250 21,130 a1. Insurance expense -438 -438     Balances 42,130 2,640 4,812 2,640 26,250 20,692 a2. Supplies expense -396 -396     Balances, February 28 42,130 2,244 4,812 2,640 26,250 20,296 Statement of Cash Flows Income Statement a. Financing $26,250   d. Fees earned $60,575 b. Operating -5,250   e. Wages expense -22,200 d. Operating 60,575   e. Rent expense -3,700 e. Operating -29,785   e. Utilities expense -1,850 f. Financing -9,660   e. Miscellaneous expense -2,035    Increase in cash $42,130 a1. Ins. exp.   -438 a2. Supplies exp.   -396        Net income $29,956

Prepare an income statement for February. The Fifth Season Income Statement For the Month Ended February 28, 20Y4 Fees earned $ Operating expenses: Wages expense $ Rent expense Utilities expense Supplies expense Insurance expense Miscellaneous expense Total expenses Net income $

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An income statement lists revenues and expenses. When revenues are more than the expenses, the difference is net income.

Prepare a retained earnings statement for February. If an amount box does not require an entry, leave it blank or enter zero “0”. The Fifth Season Statement of Stockholders’ Equity For the Month Ended February 28, 20Y4 Common Stock Retained Earnings Total Balance, February 1 $ $ $ Issued common stock Retained earnings Dividends Balance, February 28 $ $ $

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