Chapter 2, Problem 7CP

a.

To determine

Prepare a chart of accounts that would be appropriate for Service EC.

b.

To determine

Prepare an income statement for the month of June using T-accounts in order to assess the profitability of Service EC.

c.

To determine

Compute t he amount of cash on hand on June 30 based on Person CN’s records of receipts and payments.

d.

To determine

Discuss the possible causes of the difference between the amount of cash computed in (c) and the actual amount of cash on hand.