Ask Question, Ask an Expert

+1-415-315-9853

info@mywordsolution.com

Ask Financial Accounting Expert

Fred Klein began his own business recently. He starts by depositing $5,000 of his own money (equity) in a business account.  Once he had done that his balance sheet was as shown:

Assets Liabilities and Equity

Cash $5,000 Equity $5,000

Total Assets $5,000 Total L&E $5,000

Throughout the next month, his first month of business, he completed the given transactions:  (All payments were made with checks out of the bank account.)

a) Purchased $2,500 worth of inventory, paying $1,500 down and owing the vendor the remainder.

b) Utilized $500 of the inventory in making product.

c) Paid employee's wages on the last day of the month of $1,100. 

d) Sold the entire product made in the first month on credit for $3,000. 

Paid rent of $1,200.

1. Prepare a balance sheet for Fred's business at the end of its first month.

2. Prepare Fred's income statement.

3. Prepare Fred's statement of cash flows for the month.

4. Is Fred's business profitable in an accounting sense? Is a cash flow sense?

5. Can the business fail as making a profit? How might that occur in the next month or so?

Financial Accounting, Accounting

  • Category:- Financial Accounting
  • Reference No.:- M915856

Have any Question? 


Related Questions in Financial Accounting

Burger king investigation of the following1decreasing

Burger King investigation of the following: 1.Decreasing Revenue 2.Change in Revenue Mix 3.Significant Change in "food paper & product costs" line item 4.Other significant change in expense Tim Horton's 1-Accounts Receiv ...

Financial accounting assignmentcase study 1 - activity

FINANCIAL ACCOUNTING ASSIGNMENT Case Study 1 - Activity Classification (Statement of Cash Flows) You are provided with the following transactions that took place during a recent fiscal year. Transaction Statement of Cash ...

Project peyton approved instructionsfor this deliverable

Project Peyton Approved Instructions For this deliverable, you will complete the accounting cycle and prepare financial statements that will provide the result you need to assess the success of business operations. Below ...

Assignment1 frazer corporation purchased 60 percent of

Assignment 1. Frazer Corporation purchased 60 percent of Minnow Corporation's voting common stock on January 1, 20X1. On December 31, 20X1 Frazer received $210,000 from Minnoq for a truck. Frazer had purchased on January ...

You may have to start with a free trial with a credit card

You may have to start with a free trial with a credit card and cancel directly after this module submission. Once QuickBooksTM is loaded, you may have to reboot your computer. Setting up company: Go to Home page, select ...

1 differentiate between economic rights and non-economic

1. Differentiate between economic rights and non-economic rights under the 14 th amendment. 2. Explain the importance of quality management and apply statistical quality control techniques. 3. To what extent do sole prop ...

Accounting for contributions vary by usethe city of

Accounting for Contributions Vary by Use The City of Jamestown has agreed to acquire a new city maintenance building under a capital lease agreement. At the inception of the lease, a payment of $100,000 is to be made; ni ...

The market environment heavily influences corporate

The market environment heavily influences corporate decision-making ability. Identify the differences in executive decisions concerning pricing, product design, and advertising between a company in a competitive market a ...

1 accrual income versus cash flow for a period thomas book

1. Accrual income versus cash flow for a period Thomas Book Sales, Inc., supplies textbooks to college and university bookstores. The books are shipped with a proviso that they must be paid for within 30 days but can be ...

Territory account management calculating sales compensation

Territory Account Management Calculating Sales Compensation In problems 1 – 4, compute both the commission and the total pay based on the information given. 1. Salary, $3,000; commission rate, 6%, total sales, $58,000; r ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

WalMart Identification of theory and critical discussion

Drawing on the prescribed text and/or relevant academic literature, produce a paper which discusses the nature of group

Section onea in an atwood machine suppose two objects of

SECTION ONE (a) In an Atwood Machine, suppose two objects of unequal mass are hung vertically over a frictionless

Part 1you work in hr for a company that operates a factory

Part 1: You work in HR for a company that operates a factory manufacturing fiberglass. There are several hundred empl

Details on advanced accounting paperthis paper is intended

DETAILS ON ADVANCED ACCOUNTING PAPER This paper is intended for students to apply the theoretical knowledge around ac

Create a provider database and related reports and queries

Create a provider database and related reports and queries to capture contact information for potential PC component pro