EXAMPLE 2 During the month of January, Mr. Alan Bagon, lawyer, 1.Invested $5,000 to open his law practice 2.Bought supplies (stationery, forms, pencils, etc.) for cash, $300 3.Bought office equipment from Altway Furniture Company on account, $2,500 4. Received $2,000 in fees earned during the month 5. Paid office rent for January, $500 6. Paid salary for part-time help, $200 7. Paid $1,000 to Altway Furniture Company on account 8. After taking an inventory at the end of the month, found that he had used $200 worth of sumn 9. Withdrew $300 for personal use These transactions might be analyzed and recorded as follows: Transaction (1), Mr Bagon invested $5,000 to open his law practice. There are two accounts that are die The asset Cash is increased, and the capital of the firm is increased by the same amount
EXAMPLE 2 During the month of January, Mr. Alan Bagon, lawyer, 1.Invested $5,000 to open his law practice 2.Bought supplies (stationery, forms, pencils, etc.) for cash, $300 3.Bought office equipment from Altway Furniture Company on account, $2,500 4. Received $2,000 in fees earned during the month 5. Paid office rent for January, $500 6. Paid salary for part-time help, $200 7. Paid $1,000 to Altway Furniture Company on account 8. After taking an inventory at the end of the month, found that he had used $200 worth of sumn 9. Withdrew $300 for personal use These transactions might be analyzed and recorded as follows: Transaction (1), Mr Bagon invested $5,000 to open his law practice. There are two accounts that are die The asset Cash is increased, and the capital of the firm is increased by the same amount
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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EXAMPLE 2
During the month of January, Mr. Alan Bagon, lawyer,
1.Invested $5,000 to open his law practice
2.Bought supplies (stationery, forms, pencils, etc.) for cash, $300
3.Bought office equipment from Altway Furniture Company on account, $2,500
4. Received $2,000 in fees earned during the month
5. Paid office rent for January, $500
6. Paid salary for part-time help, $200
7. Paid $1,000 to Altway Furniture Company on account
8. After taking an inventory at the end of the month, found that he had used $200 worth of sumn
9. Withdrew $300 for personal use
These transactions might be analyzed and recorded as follows:
Transaction (1), Mr Bagon invested $5,000 to open his law practice. There are two accounts that are die
The asset Cash is increased, and the capital of the firm is increased by the same amount
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