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 transactior occurred. 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. 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 ovnoncos for mont+h on accOunt $ 170 5.
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 transactior occurred. 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. 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 ovnoncos for mont+h on accOunt $ 170 5.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text: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 transactions
occurred.
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.
Transcribed Image Text:Prepare an owner's equity statement for August. (List items that increase owner's equity first.)
MARY SMITH, ATTORNEY AT LAW
Owner's Equity Statement
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