Mijka Company was started on January 1, 2018. During 2018, the company experienced the following three accounting events: (1) earned cash revenues of $34,600, (2) paid cash expenses of $15,200, and (3) paid a $3,500 cash dividend to its stockholders. These were the only events that affected the company during 2018.

Required:

Record the effects of each accounting event under the appropriate general ledger account headings.

Prepare an income statement, statement of changes in stockholders' equity, and a balance sheet dated December 31, 2018, for Mijka Company.

Question

Business

Vance Harmon

10 January, 19:20

Mijka Company was started on January 1, 2018. During 2018, the company experienced the following three accounting events: (1) earned cash revenues of $34,600, (2) paid cash expenses of $15,200, and (3) paid a $3,500 cash dividend to its stockholders. These were the only events that affected the company during 2018.

Required:

Record the effects of each accounting event under the appropriate general ledger account headings.

Prepare an income statement, statement of changes in stockholders' equity, and a balance sheet dated December 31, 2018, for Mijka Company.

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Answers (1)

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Arturo Kirby · Answer 1

Assets = Liabilities + Stockholder's equity

Cash = Common stock+Retained earnings

1. Cash

revenues 34600 NA NA 34600

2. Paid

expenses (15200) NA NA (15200)

3. Paid

dividend (3500) NA NA (3500)

Ending balance 15900 = 0 + 0 + 15900

Income statement

Revenue $34600

Expense (15200)

Net income $19400

Statement of changes in stockholders' equity

Common stock $0

Retained earnings:

Net income $19400

Less: dividends (3500)

Total stockholder's equity $15900

Balance sheet

Assets:

Cash $15900

Liabilities $0

Stockholder's equity:

Common stock 0

Retained earnings 15900

Total stockholder's equity $15900

Total liabilities and stockholder's equity $15900