Fischer Card Shop is a small retail shop. Fischer's balance sheet at year-end 2014 is as follows. The following information details transactions and adjustments that occurred during 2015. 1. Sales total $145,850 in 2015; all sales were cash sales.
2. Inventory purchases total $76,200 in 2015; at December 31, 2015, inventory totals $14,500. Assume all purchases are made on account.
3. Accounts payable totals $4,100 at December 31, 2015.
4. Annual store rent for $24,000 and was paid on March 1, 2015, covering the next 12 months. The balance in prepaid rent at December 31, 2014, was the balance remaining from the advance rent payment in 2014.
5. Wages are paid every other week on Friday; during 2015, Fischer paid $12,500 cash for wages. At December 31, 2015, Fischer owed employees unpaid and unrecorded wages of $350.
6. Depreciation on equipment totals $1,700 in 2015.
(c) Set up T-accounts, including beginning balances, and post the journal entries to those T-accounts on the appropriate line.
After all transactions are recorded, compute the balance for each account in the appropriate column.
Fischer Card Shop
Balance Sheet
December 31, 2014
Cash $8,500 Accounts payable $5,200
Inventories 12,000 Wages payable 100
Prepaid rent 3,800 Total current liabilities 5,300
Total current assets 24,300 Total equity (includes retained earnings) 23,500
Equipment $7,500 Total liabilities and equity $28,800
Less Accumulated depreciation 3,000
Equipment, net 4,500
Total assets $28,800