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> Decision Case 3-1 One year ago, Tyler Stasney founded Swift Classified Ads. Stasney remembers that you took an accounting course while in college and comes to you for advice. He wishes to know how much net income his business carned during the past year in order to decide whether to keep the company going. His accounting records consist of the T-accounts from his ledger, which were prepared by an accountant who moved to another city. The ledger at December 31 follows. The accounts have not been adjusted. Salaries Expense Accounts Payable 121,500 Dec. 31 Cash Common Stock Dec 31 5,800 20,000 Dec 31 Dec 31 17,000 Dividends Depreciation Expense-Equipment Accounts Receivable Unearned Revenue Dec 31 12,000| 4,000 Dec. 31 Dec. 31 28,000| Salaries Payable Prepaid Rent 2,800 Service Revenue Rent Expense 59,500 Dec 31 Jan. 2 Office Supplies Jan. 2 2,600| Utilities Expense Dec 31 800 Supplies Expense Equipment Jan. 2 36,000 Accumulated Depreciation-Equipment Stasney indicates that at year-end, customers owe the business $1,600 for accrued service revenue. These revenues have not been recorded. During the year, Swift Classified Ads collected $4,000 service revenue in advance from customers, but the business earned only $900 of that amount. Rent expense for the year was $2,400, and the business used up $1,700 of the supplies. Swift determines that depreciation on its equipment was $5,000 for the year. At December 31, the business owes an employee $1,200 accrued salary. Help Swift Classified Ads compute its net income for the year. Advise Stasney whether to continue operating Swift Classified Ads. CHAPTER 3

> Decision Case 3-1 One year ago, Tyler Stasney founded Swift Classified Ads. Stasney remembers that you took an accounting course while in college and comes to you for advice. He wishes to know how much net income his business carned during the past year in order to decide whether to keep the company going. His accounting records consist of the T-accounts from his ledger, which were prepared by an accountant who moved to another city. The ledger at December 31 follows. The accounts have not been adjusted. Salaries Expense Accounts Payable 121,500 Dec. 31 Cash Common Stock Dec 31 5,800 20,000 Dec 31 Dec 31 17,000 Dividends Depreciation Expense-Equipment Accounts Receivable Unearned Revenue Dec 31 12,000| 4,000 Dec. 31 Dec. 31 28,000| Salaries Payable Prepaid Rent 2,800 Service Revenue Rent Expense 59,500 Dec 31 Jan. 2 Office Supplies Jan. 2 2,600| Utilities Expense Dec 31 800 Supplies Expense Equipment Jan. 2 36,000 Accumulated Depreciation-Equipment Stasney indicates that at year-end, customers owe the business $1,600 for accrued service revenue. These revenues have not been recorded. During the year, Swift Classified Ads collected $4,000 service revenue in advance from customers, but the business earned only $900 of that amount. Rent expense for the year was $2,400, and the business used up $1,700 of the supplies. Swift determines that depreciation on its equipment was $5,000 for the year. At December 31, the business owes an employee $1,200 accrued salary. Help Swift Classified Ads compute its net income for the year. Advise Stasney whether to continue operating Swift Classified Ads. CHAPTER 3

College Accounting (Book Only): A Career Approach
College Accounting (Book Only): A Career Approach
13th Edition
ISBN:9781337280570
Author:Scott, Cathy J.
Publisher:Scott, Cathy J.
Chapter3: The General Journal And The General Ledger
Section: Chapter Questions
Problem 4A: What Would You Do? You are responsible for preparing all of the journal entries for Regional...
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Calculate the net income for the year and post it on the Discussion Board, as well as all supporting documentation to arrive at the net income.
- Each group will also advise Tyler Stasney whether to continue operating Swift Classified Ads and post their advice on the Discussion Board, writing a minimum of two to three sentences on the Discussion Board.

> Decision Case 3-1 One year ago, Tyler Stasney founded Swift Classified Ads. Stasney remembers that you took an accounting course while in college and comes to you for advice. He wishes to know how much net income his business carned during the past year in order to decide whether to keep the company going. His accounting records consist of the T-accounts from his ledger, which were prepared by an accountant who moved to another city. The ledger at December 31 follows. The accounts have not been adjusted. Salaries Expense Accounts Payable 121,500 Dec. 31 Cash Common Stock Dec 31 5,800 20,000 Dec 31 Dec 31 17,000 Dividends Depreciation Expense-Equipment Accounts Receivable Unearned Revenue Dec 31 12,000| 4,000 Dec. 31 Dec. 31 28,000| Salaries Payable Prepaid Rent 2,800 Service Revenue Rent Expense 59,500 Dec 31 Jan. 2 Office Supplies Jan. 2 2,600| Utilities Expense Dec 31 800 Supplies Expense Equipment Jan. 2 36,000 Accumulated Depreciation-Equipment Stasney indicates that at year-end, customers owe the business $1,600 for accrued service revenue. These revenues have not been recorded. During the year, Swift Classified Ads collected $4,000 service revenue in advance from customers, but the business earned only $900 of that amount. Rent expense for the year was $2,400, and the business used up $1,700 of the supplies. Swift determines that depreciation on its equipment was $5,000 for the year. At December 31, the business owes an employee $1,200 accrued salary. Help Swift Classified Ads compute its net income for the year. Advise Stasney whether to continue operating Swift Classified Ads. CHAPTER 3
Transcribed Image Text:> Decision Case 3-1 One year ago, Tyler Stasney founded Swift Classified Ads. Stasney remembers that you took an accounting course while in college and comes to you for advice. He wishes to know how much net income his business carned during the past year in order to decide whether to keep the company going. His accounting records consist of the T-accounts from his ledger, which were prepared by an accountant who moved to another city. The ledger at December 31 follows. The accounts have not been adjusted. Salaries Expense Accounts Payable 121,500 Dec. 31 Cash Common Stock Dec 31 5,800 20,000 Dec 31 Dec 31 17,000 Dividends Depreciation Expense-Equipment Accounts Receivable Unearned Revenue Dec 31 12,000| 4,000 Dec. 31 Dec. 31 28,000| Salaries Payable Prepaid Rent 2,800 Service Revenue Rent Expense 59,500 Dec 31 Jan. 2 Office Supplies Jan. 2 2,600| Utilities Expense Dec 31 800 Supplies Expense Equipment Jan. 2 36,000 Accumulated Depreciation-Equipment Stasney indicates that at year-end, customers owe the business $1,600 for accrued service revenue. These revenues have not been recorded. During the year, Swift Classified Ads collected $4,000 service revenue in advance from customers, but the business earned only $900 of that amount. Rent expense for the year was $2,400, and the business used up $1,700 of the supplies. Swift determines that depreciation on its equipment was $5,000 for the year. At December 31, the business owes an employee $1,200 accrued salary. Help Swift Classified Ads compute its net income for the year. Advise Stasney whether to continue operating Swift Classified Ads. CHAPTER 3
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