Lisa Anderson opened a law office on July 1, 2020. On July 31, the balance sheet showed Cash $5,800, Accounts Receivable $1,600, Supplies $600, Equipment $5,500, Accounts Payable $3,500, and Owner's Capital $10,000. During August, the following transactions occurred. 1. 2. 3: 4, 5. 6. 7. 8. Collected $1.300 of accounts receivable. Paid $2,700 cash on accounts payable. Recognized revenue of $7.300, of which $1.500 is collected in cash and the balance is due in September. Purchased additional equipment for $1.500, paying $400 in cash and the balance on account. Paid salaries $2,300, rent for August $1,000, and advertising expenses $350. Withdrew $700 in cash for personal use. Received $1,800 from Standard Federal Bank-money borrowed on a note payable. Incurred utility expenses for month on account $180. Prepare an income statement for August.
Lisa Anderson opened a law office on July 1, 2020. On July 31, the balance sheet showed Cash $5,800, Accounts Receivable $1,600, Supplies $600, Equipment $5,500, Accounts Payable $3,500, and Owner's Capital $10,000. During August, the following transactions occurred. 1. 2. 3: 4, 5. 6. 7. 8. Collected $1.300 of accounts receivable. Paid $2,700 cash on accounts payable. Recognized revenue of $7.300, of which $1.500 is collected in cash and the balance is due in September. Purchased additional equipment for $1.500, paying $400 in cash and the balance on account. Paid salaries $2,300, rent for August $1,000, and advertising expenses $350. Withdrew $700 in cash for personal use. Received $1,800 from Standard Federal Bank-money borrowed on a note payable. Incurred utility expenses for month on account $180. Prepare an income statement for August.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Lisa Anderson opened a law office on July 1, 2020. On July 31, the balance sheet showed Cash $5,800, Accounts Receivable $1.600,
Supplies $600, Equipment $5,500, Accounts Payable $3,500, and Owner's Capital $10,000. During August, the following
transactions occurred.
Collected $1.300 of accounts receivable.
Paid $2,700 cash on accounts payable.
Recognized revenue of $7,300, of which $1.500 is collected in cash and the balance is due in September.
Purchased additional equipment for $1,500, paying $400 in cash and the balance on account.
Paid salaries $2,300, rent for August $1,000, and advertising expenses $350.
6.
Withdrew $700 in cash for personal use.
7₁
Received $1,800 from Standard Federal Bank-money borrowed on a note payable.
8. Incurred utility expenses for month on account $180.
1.
2.
3.
4.
5.
Prepare an income statement for August.
Revenues
Rent Revenue
Expenses
Salaries and Wages Expense
Rent Revenue
Advertising Expense
Utilities Expense
Total Expenses
Net Income/(Loss)
LISA ANDERSON, ATTORNEY AT LAW
Income Statement
For the Month Ended August 31, 2020
7300
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