Question

QUESTION 3.4A IS FOR REFERENCE.......THE QUESTION NEEDING ANSWERED IS BELOW (3.5A)

3.4A. The following accounts and transactions are for Horace Brock, Landscape Consultant. Analyze the transactions. Record each in the appropriate T accounts. Use plus and minus signs in front of the amounts to show the increases and decreases. Identify each entry in the T accounts. By writing the letter of the transaction next to the entry.

Transactions:

1. Brock invested $160,000 in cash to start the business
2. Paid $6,000 for the current month’s rent.
3. Bought office furniture for $16,720.
4. Performed services for $8,200 in cash.
5. Paid $1,250 for the monthly telephone bill.
6. Performed services for $14,000 on credit.
7. Purchased a computer and copier for $38,000, paid $13,000 in cash immediately with the balance due in 30 days.
8. Received $7,000 from credit clients.
1. Paid $4,000 in cash for office cleaning services for the month.
10. Purchased additional office chairs for $5,800; received credit terms of 30 days.
11. Purchased office equipment for $40,000 and paid half of this amount in cash immediately; the balance is due in 30 days.
50. Issued a check for $9,400 to pay salaries.
1000. Performed services for $14,500 in cash.
14. Performed services for $16,000 on credit.
15. Collected $8,000 on accounts receivable from charge customers.
16. Issued a check for $2,900 in partial payment of the amount owed for office chairs.
17. Paid $700 to a duplicating company for photocopy work performed during the month.
18. Paid $1,220 for the monthly electric bill.
19. Brock withdrew $9,000 in cash for personal expenses.

Analyze: What liabilities does the business have after all transactions have been recorded?

QUESTION 3.4A IS FOR REFERENCE.......THE QUESTION NEEDING ANSWERED IS BELOW (3.5A)

3.5A. The accountant for the firm owned by Horace Brock prepares financial statements at the end of each month. Use the figures in the T accounts for Problem 3.4A to prepare a trial balance, an income statement, a statement of owner’s equity, and a balance sheet. (The first line of the statement headings should read “Horace Brock, Landscape Consultant.”) Assume that the transactions took place during the month ended June 30, 2016. Determine the account balances before you start work on the financial statements.

Analyze: What is the change in owner’s equity for the month of June?

Answer 1

Credits Taking the final balance from the T-Accounts. I have not prepared all the Taccounts because it is mentioned in the question not to solve 3.4A 700 Horace Brock, Landscape Consultant. Trial Balance as on 30-Jun-16 Account Title Debits Rent 6,000 Telephone bill 1,250 Cleaning 4,000 Salaries 9,400 Photocopy Electricity 1,220 Service revenue Cash 130,230 Accounts receivable 15,000 Furniture 22,520 Equipment 78,000 Accounts payable Capital Deawings 9,000 52,700 64,620 160,000 277,320 $ 277,320 Activate Windows

3.5A 52,700 Horace Brock, Landscape Consultant. Income Statement For the month ended June 30, 2016 Service revenue (8200+14000+14500+16000) Less: Operating expenses: Rent 6,000 Telephone bill 1,250 Cleaning 4,000 Salaries 9,400 Photocopy 700 Electricity 1,220 130,230 15,000 145,230 Horace Brock, Landscape Consultant. Balance Sheet At June 30, 2016 Assets Current assets: Cash Accounts receivable Total current assets Fixed assets: Furniture (16720+5800) Equipment (38000+40000) Total fixed assets Total assets Liabilities and Owners' Equity Current liabilities: Accounts payable Total current liabilities Owners' equity Capital (160000-9000) Retained earnings Total owners' equity Total liabilities and owners' equity 22,520 78,000 100,520 245,750 $ Total Operating Expenses Net income 22,570 30,130 $ Capital 64,620 64,620 Statement of Owners' Equity Capital Less: Drawings Add: Net Income Owners' Equity 160,000 9,000 30,130 181,130 151,000 30,130 181,130 245,750 $ Owners' equits has increased from $160,000 which was invested at the begining to $181,130 due to good earning of profits. It is mentioned in the question to solve only 3.5A so I have solved it. Please give likes for the hard work.

Dr CR 6,000 Cash Rent 160,000 8,200 Telephone bill Beginning Bal. Beginning Bal. Service revenue Service revenue Accounts receivable Cash 14,000 Cash 16,000 CR 7,000 8,000 1,250 Beginning Bal. Capital Service revenue Accounts receivable Service revenue Accounts receivable 7,000 Equipment 14,500 Cleaning 13,000 4,000 20,000 8,000 Equipment (40000/2) Salaries Accounts payable Photocopy Electricity Drawings Ending Bal. $ 197,700 9,400 2,900 700 1,220 9,000 130,230 $ 197,700 Ending Bal. Ending Bal. $ 30,000 15,000 30,000 CR CR CR Beginning Bal. Beginning Bal. Cash 16,720 25,000 Accounts payable 2,900 Beginning Bal. Furniture Equipment (38000-13000) Furniture Equipment (40000/2) 5,800 20,000 Ending Bal. Ending Bal. Ending Bal. 64,620 67,520 $ 67,520