Reference no: EM132977800
Question - Jasmine, the owner of Magic Carpets Limited has approached you for assistance. Her accountant, Mr. Jafar has quit suddenly without preparing her financial statements for the month ended April 30, 2021.
Jasmine needs to send the financial statements to the bank in hopes of getting a loan to purchase a new vehicle.
She has come to you to see if you can help her prepare the financial statements.
Aladdin, Jasmine's assistant, has prepared the following list of accounts in random order with their balances at April 30, 2021
Accounts receivable 32,600 Sales revenue 120,800
Telephone expense 600 Cash 56,950
Supplies 2,000 Income taxes payable 7 ,500
Accounts payable 39,800 Salary expense 56,500
Utilities expense 1,500 Income tax expense 7,500
Insurance expense 300 Bank loan (long term) 80,000
Equipment 8,000 Rent expense 1,600
Salary payable 6,650 Building 102,000
Share capital 8,000 Land 20,000
Prepaid expense 2,800 Supplies expense 9,000
The retained earnings on April 1, 2021 was $48,600. Dividends amounting to $10,000 were paid during April 2021. During the month $3,000 of share capital were issued.
Required -
a. Prepare the income statement for Magic Carpets Limited for the month ended April 30, 2021.
b. Prepare the statement of changes in equity for Magic Carpets Limited for the month ended April 30, 2021.
c. Prepare the balance sheet for Magic Carpets Limited as of April 30, 2021.