Question

During its first month of operation, the Rawls Repair Company,which specializes in bicycle repairs, completed the followingtransactions: Feb. 1 Owner, John Rawls, began business by investing$10,000 in exchange for common stock. Feb. 1 Paid the premium on aone-year insurance policy, $1,200. Feb. 1 Paid the current month'srent, $1,040. Feb. 3 Purchased repair equipment from ConklinCompany, $4,400 by signing a 2-year note. Feb. 8 Purchased repairsupplies from McKenna Company on credit, $420. Feb. 19 Madepartial-payment to McKenna Company, $200. Feb. 20 Paid wages topart-time assistant, $800. Feb. 29 Cash bicycle repair revenue forFebruary, $3,200. Feb. 29 Owner, John Rawls was paid a dividend of$600. Feb. 29 Received a bill for February utilities, $185, to bepaid in March

Requirement #1:

Prepare the financial statements for Rawls Repair Company as ofFebruary 29:

Income Statement

Retained Earnings Statement

Classified Balance Sheet (note: be sure to make a ClassifiedBalance Sheet)

Requirement #2:

Prepare the closing entries at February 29 in the Journal.