Sonya Jared opened a law offi ce on July 1, 2020, On July 31, the Balance Sheet showed Cash $5,000, Accounts Receivable $1,500, Supplies $500, Equipment S6,000, Accounis Payable $4,200, and Owner's Capital $8,800. During August, the following transactions occurred. 1. Collected $1,200 of accounts receivable. 2. Paid $2,800 cash on accounts payable. 3. Recognized revenue of $7,500 of which $4,000 is collected in cash and the balance is due in September. 4. Purchased additional equipment for $2,000, paying $400 in cash and the balance on account. 5. Paid salaries $2,800, rent for August $900, and advertising expenses $400. 6. Withdrew $700 in cash for personal use. 7. Received $2,000 from Standard Federal Bank money borrowed on a note payable. 8. Incurred utility expenses for month on accunt $270. Instructions a. Prepare a tabular analysis of the August transactions beginning with July 31 balances, The column headings should be as follows: Cash + Accounts Receivable + Supplies + Equipment = Notes Payable + Accounts Payable + Owner's Capital - Owner's Drawings + Revenues – Expenses, b. Prepare an Income Statement for August, an owner's Equity statement for August, and a balance sheet at August 31.
Sonya Jared opened a law offi ce on July 1, 2020, On July 31, the Balance Sheet showed Cash $5,000, Accounts Receivable $1,500, Supplies $500, Equipment S6,000, Accounis Payable $4,200, and Owner's Capital $8,800. During August, the following transactions occurred. 1. Collected $1,200 of accounts receivable. 2. Paid $2,800 cash on accounts payable. 3. Recognized revenue of $7,500 of which $4,000 is collected in cash and the balance is due in September. 4. Purchased additional equipment for $2,000, paying $400 in cash and the balance on account. 5. Paid salaries $2,800, rent for August $900, and advertising expenses $400. 6. Withdrew $700 in cash for personal use. 7. Received $2,000 from Standard Federal Bank money borrowed on a note payable. 8. Incurred utility expenses for month on accunt $270. Instructions a. Prepare a tabular analysis of the August transactions beginning with July 31 balances, The column headings should be as follows: Cash + Accounts Receivable + Supplies + Equipment = Notes Payable + Accounts Payable + Owner's Capital - Owner's Drawings + Revenues – Expenses, b. Prepare an Income Statement for August, an owner's Equity statement for August, and a balance sheet at August 31.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Sonya Jared opened a law offi ce on July 1, 2020. On July 31, the Balance Sheet showed Cash $5,000,
Accounts Receivable $1,500, Supplies $500, Equipment S6,000, Accounts Payable $4,200, and Owner's
Capital $8,800. During August, the föllowing transactions occurred.
1. Collected $1,200 of accounts receivable.
2. Paid $2,800 cash on accounts payable.
3. Recognized revenue of $7,500 of which $4,000 is collected in cash and the balance is due in September.
4. Purchased additional equipment for $2,000, paying $400 in çash and the balance on account.
5. Paid salaries $2,800, rent for August $900, and advertising expenses $400.
6. Withdrew $700 in cash for personal use.
7. Received $2,000 from Standard Federal Bank money borrowed on a note payable.
8. Incurred utility expenses for month on account $270.
Instructions
a. Prepare a tabular analysis of the August transactions beginning with July 31 balances, The column
headings should be as follows: Cash + Accounts Receivable + Supplies + Equipment = Notes Payable +
Accounts Payable + Owner's Capital – Owner's Drawings + Revenues – Expenses,
b. Prepare an Income Statement for August, an owner's Equity statement for August, and a balance sheet at
August 31.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F956ceb24-c6a8-4218-a305-e38938129f02%2F3b26d9ac-f918-4645-bbd6-ff30823e73e9%2Fra7rdj_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Sonya Jared opened a law offi ce on July 1, 2020. On July 31, the Balance Sheet showed Cash $5,000,
Accounts Receivable $1,500, Supplies $500, Equipment S6,000, Accounts Payable $4,200, and Owner's
Capital $8,800. During August, the föllowing transactions occurred.
1. Collected $1,200 of accounts receivable.
2. Paid $2,800 cash on accounts payable.
3. Recognized revenue of $7,500 of which $4,000 is collected in cash and the balance is due in September.
4. Purchased additional equipment for $2,000, paying $400 in çash and the balance on account.
5. Paid salaries $2,800, rent for August $900, and advertising expenses $400.
6. Withdrew $700 in cash for personal use.
7. Received $2,000 from Standard Federal Bank money borrowed on a note payable.
8. Incurred utility expenses for month on account $270.
Instructions
a. Prepare a tabular analysis of the August transactions beginning with July 31 balances, The column
headings should be as follows: Cash + Accounts Receivable + Supplies + Equipment = Notes Payable +
Accounts Payable + Owner's Capital – Owner's Drawings + Revenues – Expenses,
b. Prepare an Income Statement for August, an owner's Equity statement for August, and a balance sheet at
August 31.
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