Use the following financial statements and additional information. BARCELONA INC.
Comparative Balance Sheets June 30, 2017 and 2016
2017 2016
Assets
Cash $ 86,300 41,700
Accounts receivable, net 61,000 92,000
Inventory 6,300 235, 300
Prepaid expenses 201,000 142,000
Total current assets (39,000 (13,000)
Equipment 78,000 66,000
Accum. depreciation-Equipment 5,000 153,000
Total assets $349,300 $330,000
Liabilities and Equity
Accounts payable 30,000 36,000
Wages payable 8,000 19,000
Income taxes payable 3,600 4,000
Total current liabilities 41,600 59,000
Notes payable (long term) 38,000 75,000
Total liabilities 79,600 134,000
Equity
Common stock, $5 par value 220,000 160,000
Retained earnings 49,300 36, 000
Total liabilities and equity $330,000 49,700
Additional Information
A. A $38,000 note payable is retired at its $38,000 carrying (book) value in exchange for cash.
B. The only changes affecting retained earnings are net income and cash dividends paid.
C. New equipment is acquired for $67,600 cash.
D. Received cash for the sale of equipment that had cost $58,600, yielding a $3,000 gain.
E. Prepaid Expenses and Wages Payable relate to Other Expenses on the income statement.
F. All purchases and sales of inventory are on credit.
Using the income statement, the comparative balance sheet, and the additional information given above, reconstruc the summarized activity of the current fiscal year. Upon completion, the trial balance tab should agree with the General Requirement General Direct MethodE Indirect Journal Ledger Trial Balance