Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question

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
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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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