Questions: Question 9 of 9

To solve the given question, we need to analyze the provided financial worksheet for Blossom Company for the year ended December 31, 2027. The worksheet includes both the income statement and balance sheet accounts.

1. Income Statement:

   • Revenues:
     • Service Revenue: $60,100
   • Expenses:
     • Maintenance and Repairs Expense: $1,800
     • Depreciation Expense: $3,200
     • Insurance Expense: $2,000
     • Salaries and Wages Expense: $30,200
     • Utilities Expense: $1,600
   • Net Income Calculation:
     • Total Expenses = $1,800 + $3,200 + $2,000 + $30,200 + $1,600 = $38,800
     • Net Income = Total Revenues - Total Expenses = $60,100 - $38,800 = $21,300

2. Balance Sheet:

   • Assets:
     • Cash: $9,000
     • Accounts Receivable: $10,600
     • Prepaid Insurance: $2,800
     • Equipment: $24,100
     • Less: Accumulated Depreciation-Equip.: $4,300
   • Liabilities:
     • Accounts Payable: $8,900
     • Salaries and Wages Payable: $2,300
   • Owner's Equity:
     • Owner's Capital: $20,000
     • Owner's Drawings: $10,300

3. Verification:

   • Total Assets = Cash + Accounts Receivable + Prepaid Insurance + (Equipment - Accumulated Depreciation) = $9,000 + $10,600 + $2,800 + ($24,100 - $4,300) = $42,200
   • Total Liabilities and Owner's Equity = Liabilities + (Owner's Capital - Owner's Drawings + Net Income) = ($8,900 + $2,300) + ($20,000 - $10,300 + $21,300) = $42,200

The balance sheet balances, confirming the accuracy of the financial data.

The financial worksheet for Blossom Company shows a net income of $21,300 for the year ended December 31, 2027. The balance sheet is balanced with total assets equaling total liabilities and owner's equity at $42,200. This analysis is based on the provided financial data and follows standard accounting principles.