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FINANCIAL ACCOUNTING
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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On October 1, Ebony Ernst organized Ernst Consulting; on October 3, the owner contributed $82,780 in assets to launch the business. On October 31, the company's records show the following items and amounts. Cash Accounts receivable Office supplies Land $15,760 12,590 1,960 46,030 16,580 7,250 82,780 Cash withdrawals by owner Consulting revenue Rent expense Salaries expense Telephone expense Miscellaneous expenses 640 12,590 2,270 5,450 760 580 Office equipment Accounts payable Owner investments ng the above information prepare an October 31 balance sheet for Ernst Consulting. ERNST CONSULTING Balance Sheet
Transcribed Image Text:On October 1, Ebony Ernst organized Ernst Consulting; on October 3, the owner contributed $82,780 in assets to launch the business. On October 31, the company's records show the following items and amounts. Cash Accounts receivable Office supplies Land $15,760 12,590 1,960 46,030 16,580 7,250 82,780 Cash withdrawals by owner Consulting revenue Rent expense Salaries expense Telephone expense Miscellaneous expenses 640 12,590 2,270 5,450 760 580 Office equipment Accounts payable Owner investments ng the above information prepare an October 31 balance sheet for Ernst Consulting. ERNST CONSULTING Balance Sheet
Expert Solution
Step 1

Balance Sheet  is a statement  showing financial position of the business at a particular time period say at the end of a month ,quarter ,six month or a year . So it show assets  and liabilities  of business  for a particular  period .

Working  note :Statement  showing  profit  or loss for October 

Particulars  Amount  Amount $
Revenue    12590
Less  expenses     
Office  supplies   1960  
Rent  2270  
Salaries  5450  
Telephone   760  
Miscellaneous   580 11020
Net revenue     1570
     

Let us prepare balance sheet

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