An analysis of the transactions made by Mark Kotsay & Co., a certified public accounting firm, for the month of August is shown below. The expenses were $650 for rent, $4,800 for salaries and wages, and $500 for utilities.
|
Accounts |
Accounts |
Owner’s |
Owner’s |
||||||
|
Cash |
+ Receivable |
+ Supplies |
+ Equipment |
= Payable |
+ Capital |
Drawings |
+ Revenues |
Expenses |
|
|
1. |
+ $15,000 |
+ $15,000 |
|||||||
|
2. |
2,000 |
+ $5,000 |
+ $3,000 |
||||||
|
3. |
750 |
+ $750 |
|||||||
|
4. |
+ 4,600 |
+ $3,900 |
+ $8,500 |
||||||
|
5. |
1,500 |
1,500 |
|||||||
|
6. |
2,000 |
$2,000 |
|||||||
|
7. |
650 |
$650 |
|||||||
|
8. |
+ 450 |
450 |
|||||||
|
9. |
4,800 |
4,800 |
|||||||
|
10. |
+ 500 |
500 |
Instructions
(a) Describe each transaction that occurred for the month.
(b) Determine how much owner’s equity increased for the month.
(c) Compute the amount of net income for the month.