Question

Ming chen began a professional practice on June 1 and plans to prepare financial statements at the end of each month. During june, Ming Chen (the owner) complete these transactions.

a. Owner invested $ 60,000 cash in the company along with equipment that had a $ 15,000 market value.
b. The company paid $1500 cash for office space for the month.
c. The company purchased $10,000 of additional equipment on credit ( payment due within 30 days).
d. The company completed work for a client and immediately collected the $2,500 cash earned.
e. The company completed work for a client and sent a bill for $8,000 to be received within 30 days.
f.The company purchased additional equipment for $6,000 cash
g. The company paid ab assistant $3,000 cash as wages for the month.
h. The company collected $5000 cash as a partial payment for the amount owned by the client in transaction e.
I. the company paid %10,000 cash to settle the liability created in transaction c.
j. Owner withdraw $1,000 cash from the company for personal use.

Answer 1

2 Revenues & Gains 3 Service Revenue $ 10,500 ($2,500 + $8,000) 5 Expenses & Losses 6 Rent 7 Wages $ $ 1,500 3,000 9 Profit/Loss 6,000

A B D C Balance Sheet Assets 2 Liabilities 3 4 Capital $ 5 Add: Profit $ 6 Less: Drawings $ 75,000 Equipment $ 6,000 Notes Receivable $ -1,000 Cash $ 31,000 3,000 46,000 00 $ 80,000 $ 80,000