Barth Company reports the following year-end account balances at December 31, 2016. Prepare the 2016 income statement and the balance sheet as of December 31, 2016. Accounts payable $16,000    Inventory $36,000
Accounts receivable 30,000    Land 80,000
Bonds payable, long-term 200,000    Goodwill 8,000
Buildings 151,000    Retained earnings 160,000
Cash 148,000    Sales revenue 500,000
Common stock 150,000    Supplies inventory 3,000
Cost of goods sold 180,000    Supplies expense 6,000
Equipment 70,000    Wages expense 40,000

Answer and Explanation:

The preparation of the income statement and the balance sheet is presented below

Income statement

REVENUE  

Sales     $500,000

Less: EXPENSES  

Cost of goods sold ($180,000)  

Supplies expenses ($6,000)  

Wages expenses ($40,000)  

Total expenses ($226,000)

Net income $274,000

Balance sheet :

Assets      Amount              Liabilities & stockholder equity   Amount  

Cash            $148,000            Account payable                            $16,000

Account receivable $30,000  Bonds payable, long term             $200,000

Supplies      $3,000  

Inventory     $36,000                  Total liabilities                              $216,000

Total current assets $217,000    Common stock                           $150,000

Land               $80,000                  Retained earnings                     $160,000

Building          $151,000  

Equipment     $70,000  

Goodwill         $8,000  

Total assets    $526,000          Total liabilities and equity             $526,000