Sunland Engineering Services is owned by François Sunland. Here is a listing of financial statement items for the business for the year ended December 31, 2021.

Sunland Engineering Services is owned by François Sunland. Here is a listing of financial statement items for the business for the year ended December 31, 2021.

Cash $1,200 Accounts receivable 1,680 Supplies 720 Equipment 7,440 Accounts payable 980 Salaries payable 548 F. Sunland, capital January 1, 2021 7,800F. Sunland, drawings 5,280 Service revenue 17,828 Rent expense5,760 Salaries expense 3,720 Supplies expense 944 Utilities expense 412

A) Prepare income statement
B)Prepare a statement of owner's equity. (List items that increase owner's equity first.)
C)Prepare balance sheet. (List Assets in order of liquidity.)

A. Income statement 

Particulars	Amount	Amount
Revenue from operations:
Service revenue		17,828
Less Operating Expenses
Rent expense	5760
Salaries expense	3720
Supplies expense	944
Utilities expense	412
Total Expenses		10,836
Net income		6992

B. Statement of owners equity 

F. Sunland capital, January 1,2021	7800
Add Net income	6992
	14,792
Less drawings	(5280)
F. Sunland capital, Dec31,2021	9512

C. Balance sheet 

Assets
Cash	1200
Accounts receivables	1680
Supplies	720
Equipment	7440
Total Assets	11,040
Liabilities and owners equity
Accounts payable	980
Salaries payable	548
Owners equity(F.Sunland capital Dec 31,2021)	9512
Total liabilities and owners equity	11,040

 

 

Notes:

1. In income statement it is given as list items which  increase owners equity first , here we have net income which increases owners equity and drawings which decreases owners equity. So we presented net income first.

 

2. For balance sheet it is given as list assets in order of liquidity which means liquid assets are those assets which can be easily converted to cash generally we can say current assets. So here we start with cash followed by accounts receivable and supplies as these are liquid assets.