During its first month of operation, the Quick Tax Corporation, which specializes in tax preparation, completed the following transactions. July 1 Began business by making a deposit in a company bank account of $60,000, in exchange for 6,000 shares of $10 par value common stock. July 3 Paid the current month's rent, $3,500 July 5 Paid the premium on a 1-year insurance policy, $4,200 July 7 Purchased supplies on account from Little Company, $1,000. July 10 Paid employee salaries, $3,500 July 14 Purchased equipment from Lake Company, $10,000. Paid $2,500 down and the balance was placed on account. Payments will be $500.00 per month until the equipment is paid. The first payment is due 8/1. Note: Use accounts payable for the balance due. July 15 Received cash for preparing tax returns for the first half of July, $8,000 July 19 Made payment on account to Lake Company, $500. July 31 Received cash for preparing tax returns for the last half of July, $9,000 July 31 Declared and paid cash dividends of $600. Prepare the financial statements for the Quick Tax Corporation as of July 31 in the space below. You will only be preparing the income statement, statement of retained earnings, and the balance sheet. The statement of cash flows is a required financial statement, but is not required for this case study. Quick Tax Corporation Quick Tax Corporation Quick Tax Corporation Income Statement Statement of Retained Earnings Balance Sheet For the Month Ending July 31 For the Month Ending July 31 July 31 Revenues: Retained Earnings, July 1 Assets: Revenue Add: Net Income Cash Subtotal Supplies Expenses: Less: Dividends Prepaid Insurance Rent Expense Retained Earnings, July 31 Equipment Salaries Expense Less: Accum. Depr. Insurance Expense Total Assets Supplies Expense Depreciation Expense Liabilities: Income Tax Expense Accounts Payable Total Expenses Income Tax Payable Total Liabilities Net Income Stockholders' Equity: Common Stock Retained Earnings Total Stockholders' Equity Total Liabilities and Stockholders' Equity
During its first month of operation, the Quick Tax Corporation, which specializes in tax preparation,
completed the following transactions.
July 1 Began business by making a deposit in a company bank account of $60,000, in exchange
for 6,000 shares of $10 par value common stock.
July 3 Paid the current month's rent, $3,500
July 5 Paid the premium on a 1-year insurance policy, $4,200
July 7 Purchased supplies on account from Little Company, $1,000.
July 10 Paid employee salaries, $3,500
July 14 Purchased equipment from Lake Company, $10,000. Paid $2,500 down and the balance was
placed on account. Payments will be $500.00 per month until the equipment is paid. The first payment is due 8/1.
Note: Use accounts payable for the balance due.
July 15 Received cash for preparing tax returns for the first half of July, $8,000
July 19 Made payment on account to Lake Company, $500.
July 31 Received cash for preparing tax returns for the last half of July, $9,000
July 31 Declared and paid cash dividends of $600.
Prepare the financial statements for the Quick Tax Corporation as of July 31 in the space below.
You will only be preparing the income statement, statement of
The statement of
Quick Tax Corporation Quick Tax Corporation Quick Tax Corporation
Income Statement Statement of Retained Earnings Balance Sheet
For the Month Ending July 31 For the Month Ending July 31 July 31
Revenues: Retained Earnings, July 1 Assets:
Revenue Add: Net Income Cash
Subtotal Supplies
Expenses: Less: Dividends Prepaid Insurance
Rent Expense Retained Earnings, July 31 Equipment
Salaries Expense Less: Accum. Depr.
Insurance Expense Total Assets
Supplies Expense
Income Tax Expense Accounts Payable
Total Expenses Income Tax Payable
Total Liabilities
Net Income
Common Stock
Retained Earnings
Total Stockholders' Equity
Total Liabilities and
Stockholders' Equity
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