Carla Quentin started her own consulting firm, Quentin Consulting, on May 1, 2012. The following transactions occurred during the month of May.
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May |
1 |
Carla invested $7,000 cash in the business. |
|
2 |
Paid $900 for office rent for the month. |
|
|
3 |
Purchased $600 of supplies on account. |
|
|
5 |
Paid $125 to advertise in the County News. |
|
|
9 |
Received $4,000 cash for services provided. |
|
|
12 |
Withdrew $1,000 cash for personal use. |
|
|
15 |
Performed $5,400 of services on account. |
|
|
17 |
Paid $2,500 for employee salaries. |
|
|
20 |
Paid for the supplies purchased on account on May 3. |
|
|
23 |
Received a cash payment of $4,000 for services provided on account on May 15. |
|
|
26 |
Borrowed $5,000 from the bank on a note payable. |
|
|
29 |
Purchased office equipment for $4,200 on account. |
|
|
30 |
Paid $275 for utilities. |
Instructions
(a) Show the effects of the previous transactions on the accounting equation using the following format.
|
Assets |
Liabilities |
Owner’s Equity |
||||||||
|
Accounts |
Notes |
Accounts |
Owner’s |
Owner’s |
||||||
|
Date |
Cash |
+ Receivable |
+ Supplies |
+ Equipment |
= Payable |
+ Payable |
+ Capital |
Drawings |
+ Revenues |
Expenses |
(b) Prepare an income statement for the month of May.
(c) Prepare a balance sheet at May 31, 2012.