On March 1, 2008, Ginny Tyler established Seltzer Realty. Ginny completed the following transactions during the month of March:
a. Opened a business bank account with a deposit of $30,000 from personal funds.
b. Purchased supplies (pens, file folders, paper, etc.) on account, $2,650.
c. Paid creditor on account, $1,500.
d. Earned sales commissions, receiving cash, $36,750.
e. Paid rent on office and equipment for the month, $5,200.
f. Withdrew cash for personal use, $8,000.
g. Paid automobile expenses (including rental charge) for month, $2,500, and miscellaneous expenses, $1,200.
h. Paid office salaries, $9,250.
i. Determined that the cost of supplies on hand was $900; therefore, the cost of supplies used was $1,750.
Instructions
1. Indicate the effect of each transaction and the balances after each transaction, using the
following tabular headings:
|
Assets |
= |
Liabilities + |
Owner’s Equity |
||||||||
|
|
Ginny |
Ginny |
Office |
||||||||
|
|
Accounts |
Tyler, |
Tyler, |
Sales |
Salaries |
Rent |
Auto |
Supplies |
Misc. |
||
|
Cash + |
Supplies |
= |
Payable + |
Capital |
Drawing + |
Commissions |
Expense |
Expense |
Expense |
Expense |
Expense |
2. Prepare an income statement for March, a statement of owner’s equity for March, and a balance sheet as of March 31.