Amelio has operated a one person law firm for many years. During the first week of February, the following events occurred in his business.
Feb. 2 Collected $1,800 from a client for legal work performed.
3 February’s office rent of $1,200 was paid to the landlord.
4A $300 payment was made on a loan previously obtained from a local bank.
4The monthly subscription to Lawyer’s Monthly magazine (a Miscellaneous Expense) was paid: $35.
5 Collected $4,250 for legal services performed.
5 Purchased a computer for $3,200 using cash.
6 Wages were paid to the office staff totaling $525.
6 Office supplies of $128 were purchased for cash and were consumed.
Show how the events above would be recorded using the format demonstrated in the chapter.
Beginning account balances were as follows: Cash $5,000, Liabilities $1,500, Contributed Capital $3,000, and Retained Earnings $500. Prepare an income statement for the first week of February.