Horngren's Financial & Managerial Accounting (5th Edition)
5th Edition
ISBN: 9780133866292
Author: Tracie L. Miller-Nobles, Brenda L. Mattison, Ella Mae Matsumura
Publisher: PEARSON
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Textbook Question
Chapter 1, Problem 1.54CP
Using the
Daniels Consulting began operations and completed the following transactions during December 2016:
| Dec. 2 | Stockholders contributed $20,000 cash in exchange for common stock. |
| 2 | Paid monthly office rent, $2,000. |
| 3 | Paid cash for a computer, $3,600. This equipment is expected to remain in service for five years. |
| 4 | Purchased office furniture on account, $3,000. The furniture should last for five years. |
| 5 | Purchased office supplies on account, $800. |
| 9 | Performed consulting service for a client on account, $2,500. |
| 12 | Paid utilities expenses, $150. |
| 18 | Performed service for a client and received cash of $2, 1 00. |
| 21 | Received $2,400 in advance for client service to be performed in the future. (This increases the Unearned Revenue account, which is a liability. This account will be explained in more detail in Chapter 2.) |
| 21 | Hired an administrative assistant to be paid $2,055 on the 20th day of each month. The secretary begins work immediately. |
| 26 | Paid $200 on account. |
| 28 | Collected $400 on account. |
| 30 | Cash dividends of $1,000 were paid to stockholders. |
Requirements
- 1. Analyze the effects of Daniels Consulting’s transactions on the accounting equation. Use the format of Exhibit 1-6, and include these headings: Cash;
Accounts Receivable ; Office Supplies; Equipment; Furniture; Accounts Payable; Unearned Revenue; Common Stock; Dividends; Service Revenue; Rent Expense; and Utilities Expense. - 2. Prepare the income statement of Daniels Consulting for the month ended December 31, 2016.
- 3. Prepare the statement of
retained earnings for the month ended December 31, 2016. - 4. Prepare the
balance sheet as of December 31, 2016. - 5. Calculate the return on assets for Daniels Consulting for December, 2016.
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Chapter 1 Solutions
Horngren's Financial & Managerial Accounting (5th Edition)
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