Mary Smith opened a law office on July 1, 2022. On July 31, the balance sheet showed Cash $ 5,000, Accounts Receivable $ 1,500,Supplies $ 400, Equipment $ 5,500, Accounts Payable $ 3,500, and Owner's Capital $ 8,900. During August, the following transactionsoccurred.1.Collected $ 1,200 of accounts receivable.2.Paid $ 2,400 cash on accounts payable.3.Recognized revenue of $ 6,800 of which $ 1,500 is collected in cash and the balance is due in September.4.Purchased additional equipment for $ 1,500, paying $ 300 in cash and the balance on account.5.Paid salaries $ 1,700, rent for August $ 1,000, and advertising expenses $ 250.6.Withdrew $ 700 in cash for personal use.7.Received $ 1,000 from Standard Federal Bank-money borrowed on a note payable.Incurred utility expenses for month on account $ 170.8. Prepare an owner's equity statement for August. (List items that increase owner's equity first.)MARY SMITH, ATTORNEY AT LAWOwner's Equity StatementLessAdd$%24>>

The owners' equity statement represents the equity for the shareholders.

Answered: Mary Smith opened a law office on July…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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