Carla Quentin started her own consulting firm, Quentin Consulting, on May 1, 2012. The following transactions occurred during the month of May.
|
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.