Wolford Department Store is located in midtown Metropolis. During the past several years, net income has been declining because suburban shopping centers have been attracting business away from city areas. At the end of the company’s fiscal year on November 30, 2017, these accounts appeared in its adjusted trial balance. Accounts Payable $ 26,800
Accounts Receivable 17,200
Accumulated Depreciation—
Equipment 68,000
Cash 8,000
Common Stock 35,000
Cost of Goods Sold 614,300
Freight-Out 6,200
Equipment 157,000
Depreciation Expense 13,500
Dividends 12,000
Gain on Disposal of Plant Assets 2,000
Income Tax Expense 10,000
Insurance Expense 9,000
Interest Expense 5,000
Inventory 26,200
Notes Payable 43,500
Prepaid Insurance 6,000
Advertising Expense 33,500
Rent Expense 34,000
Retained Earnings 14,200
Salaries and Wages Expense 117,000
Sales Revenue 904,000
Salaries and Wages Payable 6,000
Sales Returns and Allowances 20,000
Utilities Expense 10,600

                Wolford Department Store

                     Income Statement

      For the Year Ended November 30,2017

Sales Revenue                                      $904,000

Sales Returns and Allowances             ($20,000 )

Net Sales                                               $884,000

Cost of Goods Sold                              ($614,300)

Gross profit                                           $269,700

Operating expenses:

Total operating expenses                   ($223,800)

Income from operations                         $45,900

Other revenues:

Gain on Disposal of Plant Assets            $2,000  

Other expenses:

Interest Expense                                     ($5,000 )

Income before income taxes                 $42,900

Income Tax Expense                             ($10,000)

Net income after taxes                         $32,900

                Wolford Department Store

                         Balance Sheet

      For the Year Ended November 30,2017

Assets:

Cash $8,000

Accounts Receivable $17,200

Prepaid Insurance $6,000

Inventory $26,200

Equipment $157,000

Accumulated Depreciation - Equipment (68,000)

Total Assets: $146,400

Liabilities and Stockholders' Equity:

Accounts Payable $26,800

Wages Payable $6,000

Notes Payable $43,500

Common Stock $35,000

Retained Earnings $35,100

Total Liabilities and Stockholders' Equity: $146,400

                Wolford Department Store

           Statement of Retained Earnings

      For the Year Ended November 30,2017

Retained earnings at the beginning of the period: $14,200

Net income after taxes:                                             $32,900

Dividends                                                                  ($12,000)

Retained earnings at he end of the period:           $35,100

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