The assets and liabilities of toronto service inc as of

Reference no: EM13355639

The assets and liabilities of Toronto Service Inc. as of December 31, 2008, and revenue and expenses for the year ended December 31, 2008 are listed below:

Accounts Payable	$21,000	Property tax expense	$5,000
Accounts Receivable	25,000	Rent expense	3,000
Advertising expense	10,000	Salary expense	85,000
Building	140,000	Salary payable	12,000
Cash	10,000	Service Revenue	200,000
Furniture	20,000	Share Capital	75,000
Interest expense	4,000	Supplies	3,000
Land	98,000	Note Payable	95,000

Beginning Retained Earnings were $50,000 and dividends totaled $50,000 for the year.
Required:
a. Prepare the Income Statement for the year ended December 31, 2008.
b. Prepare the Statement of Retained Earnings for the year.
c. Prepare the Balance Sheet at December 31, 2008.
d. Based on the financial statements prepared, answer the following questions:

1.Was Toronto Service Inc. profitable during 2008? If so by how much?
2.Did Retained Earnings increase or decrease? What is the amount of the change?
3.Which is the greater total, liabilities or total equity? Who owns more of the company's assets, the creditors or the shareholders?

Reference no: EM13355639

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