Thomas Corporation began business by issuing $2,000 of common stock on January 1, 2010. The business performed $8,000 of service on account in 2010 and collected $6,000 of this amount by year end. It paid operating expenses of $4,500 and paid a $500 dividend to stockholders.
Remember to show your work for parts a - c
a) What is the amount of total assets at the end of 2010?
b) What is the amount of cash on hand at the end of 2010?
c) What is the net income for 2010?
d) Prepare a balance sheet in good form for 2010
a) Total assets:
Cash $3,000 ($2,000 Stock + $6,000 collections - $4,500 expenses - $500 dividends paid)
Accounts receivable $2,000 ($8,000 Service income - $6,000 cash collected)
Total assets $5,000
b) Cash on hand
The amount of total assets and cash on hands is examined. The expert prepares balance sheet.