Lawson Consulting had the following accounts and amounts on December 31. The Retained Earnings account balance at December 1 was $0 and the owner invested $18,620 cash in the company on December 1. On December 31, the company's accounts and amounts for the month of December are shown in the table below: Cash Accounts receivable Equipment Accounts payable. Common stock $ 11,000 5,700 7,700 4,080 18,620 Dividends Services revenue Rent expense Wages expense The company began operations on December 1. QS 2-15 (Algo) Preparing an income statement LO P1 LAWSON CONSULTING Income Statement $ 2,700 15,600 3,200 8,000 Use the above information to prepare a December income statement for the business.
Reporting Cash Flows
Reporting of cash flows means a statement of cash flow which is a financial statement. A cash flow statement is prepared by gathering all the data regarding inflows and outflows of a company. The cash flow statement includes cash inflows and outflows from various activities such as operating, financing, and investment. Reporting this statement is important because it is the main financial statement of the company.
Balance Sheet
A balance sheet is an integral part of the set of financial statements of an organization that reports the assets, liabilities, equity (shareholding) capital, other short and long-term debts, along with other related items. A balance sheet is one of the most critical measures of the financial performance and position of the company, and as the name suggests, the statement must balance the assets against the liabilities and equity. The assets are what the company owns, and the liabilities represent what the company owes. Equity represents the amount invested in the business, either by the promoters of the company or by external shareholders. The total assets must match total liabilities plus equity.
Financial Statements
Financial statements are written records of an organization which provide a true and real picture of business activities. It shows the financial position and the operating performance of the company. It is prepared at the end of every financial cycle. It includes three main components that are balance sheet, income statement and cash flow statement.
Owner's Capital
Before we begin to understand what Owner’s capital is and what Equity financing is to an organization, it is important to understand some basic accounting terminologies. A double-entry bookkeeping system Normal account balances are those which are expected to have either a debit balance or a credit balance, depending on the nature of the account. An asset account will have a debit balance as normal balance because an asset is a debit account. Similarly, a liability account will have the normal balance as a credit balance because it is amount owed, representing a credit account. Equity is also said to have a credit balance as its normal balance. However, sometimes the normal balances may be reversed, often due to incorrect journal or posting entries or other accounting/ clerical errors.
please answer within the format by providing formula the detailed working
Please provide answer in text (Without image)
Please provide answer in text (Without image)
Please provide answer in text (Without image)
![Use the following information for the Quick Studies below. (Algo)
[The following information applies to the questions displayed below.]
Lawson Consulting had the following accounts and amounts on December 31. The Retained Earnings account balance at
December 1 was $0 and the owner invested $18,620 cash in the company on December 1. On December 31, the
company's accounts and amounts for the month of December are shown in the table below:
Cash
Accounts receivable
Equipment
Accounts payable
Common stock
$ 11,000
5,700
7,700
4,080
18,620
Dividends
Services revenue
Rent expense
Wages expense
The company began operations on December 1.
LAWSON CONSULTING
Income Statement
QS 2-15 (Algo) Preparing an income statement LO P1
Use the above information to prepare a December income statement for the business.
$ 2,700
15,600
3,200
8,000
< Prev
GO
10 11 12
of 12
Next >](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F492121c0-3843-4585-9c4f-58f7a1b7b43d%2F68cf331f-168c-4d9a-a0f9-1bf839b93739%2F8rp93hi_processed.jpeg&w=3840&q=75)
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
