Magic Styles, Inc. Unadjusted Trial Balance At March 31, 2023 Cash $ 18,000.00 Prepaid Insurance $ 600.00 Prepaid Rent $ 7,300.00 Equipment $ 9,700.00 Furniture and Fixtures $ 9,700.00 Accounts Payable $ 10,800.00 Deferred Revenue $ 400.00 Notes Payable Long-term) $ 20,000.00 Common Stock $ 10,000.00 Retained Earnings, February 28, 2023 $ 2,100.00 Dividends $ 300.00 Service Revenue $ 12,300.00 Supplies Expense $ 5,500.00 Salaries and Wages $ 3,200.00 Utilities Expense $ 700.00 Rent Expense $ 600.00 TOTAL $ 55,600.00 $ 55,600.00 Required: Based on the unadjusted trial balance of Magic Styles, Inc. above, you are required to prepare/write the following: 1) An income statement 2) A statement of retained earnings 3) Balance Sheet 4) A paragraph stating your evaluation of the company’s performance and financial status for the month ending March 31, 2023. In your evaluation, state whether: * the business is profitable; * it is able to pay its current obligations/liabilities; and * its assets are financed more by debts or equity.
Magic Styles, Inc.
Unadjusted
At March 31, 2023
Cash $ 18,000.00
Prepaid Insurance $ 600.00
Prepaid Rent $ 7,300.00
Equipment $ 9,700.00
Furniture and Fixtures $ 9,700.00
Accounts Payable $ 10,800.00
Deferred Revenue $ 400.00
Notes Payable Long-term) $ 20,000.00
Common Stock $ 10,000.00
Dividends $ 300.00
Service Revenue $ 12,300.00
Supplies Expense $ 5,500.00
Salaries and Wages $ 3,200.00
Utilities Expense $ 700.00
Rent Expense $ 600.00
TOTAL $ 55,600.00 $ 55,600.00
Required:
Based on the unadjusted trial balance of Magic Styles, Inc. above, you are required to prepare/write the
following:
1) An income statement
2) A statement of retained earnings
3) Balance Sheet
4) A paragraph stating your evaluation of the company’s performance and financial status for the
month ending March 31, 2023.
In your evaluation, state whether:
* the business is profitable;
* it is able to pay its current obligations/liabilities; and
* its assets are financed more by debts or equity.
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