Karen Milan open apartment locator owned and operated by Karen Milan, she engages in the following transactions: Milan Invests $ 68,500 of personal fund to start the business Purchase supplies on account $ 586 Paid cash for land near the campus $ 35,000 Received cash from clients $ 2,000 Charged clients for rent rooms on account $ 2,800 Paid wage expense $ 800 Paid utility expense $ 350 Paid creditors on account $300 Received cash from client on account $ 1,800 Karen withdraws cash for personal use $ 1,500      Required: Analyze the preceding transactions in terms of their effects on accounting equation of Karen Milan Apartment Locaters, show the balances only after the last transactions Prepare the income statement, statement of owners equity and the balance sheet of business after recording the transactions.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Karen Milan open apartment locator owned and operated by Karen Milan, she engages in the following transactions:

  1. Milan Invests $ 68,500 of personal fund to start the business
  2. Purchase supplies on account $ 586
  3. Paid cash for land near the campus $ 35,000
  4. Received cash from clients $ 2,000
  5. Charged clients for rent rooms on account $ 2,800
  6. Paid wage expense $ 800
  7. Paid utility expense $ 350
  8. Paid creditors on account $300
  9. Received cash from client on account $ 1,800
  10. Karen withdraws cash for personal use $ 1,500

     Required:

  1. Analyze the preceding transactions in terms of their effects on accounting equation of Karen Milan Apartment Locaters, show the balances only after the last transactions
  2. Prepare the income statement, statement of owners equity and the balance sheet of business after recording the transactions.
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