Question

Required information [The following information applies to the questions displayed below.) Gabi Gram started The Gram Co., a new business that began operations on May 1. The Gram Co. completed the following transactions during its first month of operations. May 1 G. Gram invested $42,500 cash in the company in exchange for its common stock. 1 The company rented a furnished office and paid $2,200 cash for May's rent. 3 The company purchased $1,920 of office equipment on credit. 5 The company paid $740 cash for this month's cleaning services. 8 The company provided consulting services for a client and immediately collected $5,700 cash. 12 The company provided $2,800 of consulting services for a client on credit 15 The company paid $730 cash for an assistant's salary for the first half of this month. 20 The company received $2,800 cash payment for the services provided on May 12. 22 The company provided $3,000 of consulting services on credit. 25 The company received $3,000 cash payment for the services provided on May 22. 26 The company paid $1,920 cash for the office equipment purchased on May 3. 27 The company purchased $85 of office equipment on credit. 28 The company paid $730 cash for an assistant's salary for the second half of this month. 30 The company paid $300 cash for this month's telephone bill. 30 The company paid $280 cash for this month's utilities. 31 The company paid $1,500 cash in dividends to the owner (sole shareholder).

Answer 1

THE GRAM CO.
The Statement of Retained Earnings
For Month Ended May 31
Retained Earnings, May 1	$0
Add:Net Income (or less: net loss)	$6,520
	$6,520
Less: Dividends	-$1,500
Retained Earnings, May 31	$5,020
Computation of Net Income
=-2200-740+5700+2800-730+3000-730-300-280