Question

Brian Aloan opens a web consulting business called Aloan Consulting and completes the following transactions in March. Using the following transactions, record journal entries, create financial statements, and assess the impact of each transaction on the financial statements. Mar. 1 Aloan invested $183,000 cash along with $23,100 in office equipment in the company in exchange for common stock. Mar. 2 The company prepaid $12,000 cash for six months' rent for an office. The company's policy is to record prepaid expenses in balance sheet accounts. Mar. 3 The company made credit purchases of office equipment for $4,100 and office supplies for $2,300. Payment is due within 10 days. Mar. 6 The company completed services for a client and immediately received $5,100 cash. Mar. 9 The company completed a $8,600 project for a client, who must pay within 30 days. Mar. 12 The company paid $6,400 cash to settle the account payable created on March 3. Mar. 19 The company paid $6,100 cash for the premium on a 12-month insurance policy. The company's policy is to record prepaid expenses in balance sheet accounts. Mar. 22 The company received $5,200 cash as partial payment for the work completed on March 9. Mar. 25 The company completed work for another client for $5,000 on credit. Mar. 29 The company paid $5,400 cash in dividends. Mar. 30 The company purchased $900 of additional office supplies on credit. Mar. 31 The company paid $800 cash for this month's utility bill. Requirement General Journal General Ledger Trial Balance Income Statement St Retained Earnings Balance Sheet Impact on Equity Using the dropdown buttons, select the item that accurately describes the values that either increase or decrease the retained earnings. ALOAN CONSULTING Statement of Retained Earnings For Month Ended March 31 Retained earnings, March 1 5,400 5.400 (5,400) Retained earnings, March 31 $ < Income Statement Balance Sheet

Answer 1

Aloan Consultants Income Statement For the Month Ended March 31 Services Revenue Utilities Expense Net Income 18,700 800 17,900

Statement of Retained Earnings For the Month Ended March 31 Retained Earnings, March 1 Add: Net Income 17,900 17,900 (5,400) 12,500 Less: Dividends Retained Earnings, March 31

Aloan Consultants Balance Sheet As of March 31 Assets Current Assets Cash 900 Accounts Receivable Office Supplies Prepaid Insurance Prepaid Rent Total Current Assets Liabilities & Stockholders Equity Current Liabilities 162,600 Accounts Payable 8,400 3,200 6,100 12,000 192,300 Property, Plant & Equipment Office Equipment Stockholders Equity 27,200 Common Stock Retained earnings Total Stockholders Equity 206,100 12,500 218,600 Total Assets 219,500 Total Liabilities & Stockholders Equity 219,500

Aloan Consultants Journal entries Date Account 1-Mar Cash Office Equipment Common Stock Debit $ 183,000 $ 23,100 $ 206,100 $ 12,000 2-Mar Prepaid Rent Cash $ 12,000 3-Mar Office Equipment Office Supplies Accounts Payable $ $ 4,100 2,300 $ 6,400 $ 5,100 6-Mar Cash Services Revenue $ 5,100 $ 8,600 9-Mar Accounts Receivable Services Revenue $ 8,600 $ 6,400 12-Mar Accounts Payable Cash $ 6,400 $ 6,100 19-Mar Prepaid Insurance Cash $ 6,100 $ 5,200 22-Mar Cash Accounts Receivable $ 5,200 $ 5,000 25-Mar Accounts Receivable Services Revenue $ 5,000 $ 5,400 29-Mar Dividends Cash $ 5,400 $ 900 30-Mar Office Supplies Accounts Payable $ 900 $ 800 31-Mar Utilities Expense Cash $ 800

Credit Credit Aloan Consultants T Accounts Date Debit Date Credit Cash 1-Mar $ 183,000 2-Mar $ 12,000 6-Mar $ 5,100 12-Mar $ 6,400 22-Mar $ 5,200 19-Mar $ 6,100 29-Mar $ 5,400 31-Mar $ 800 Date Debit Date Credit Accounts Receivable 9-Mar $ 8,600 22-Mar $ 5,200 25-Mar $ 5,000 Date Debit Date Office Supplies 3-Mar $ 2,300 30-Mar $ 900 Date Debit Date Prepaid Insurance 19-Mar $ 6,100 Bal. Bal. $162,600 Prepaid Rent 2-Mar $ 12,000 Bal. $ 8,400 Office Equipment 1-Mar $ 23,100 3-Mar $ 4,100 Bal. $ 3,200 Accounts Payable 12-Mar $ 6,400 3-Mar $ 6,400 30-Mar $ 900 $ 6,100 Common Stock 1-Mar $206,100 Bal. $ 900 $ 206,100 Bal. $ 12,000 Dividends 29-Mar $ 5,400 $ 27,200 Services Revenue 6-Mar $ 5,100 9-Mar $ 8,600 25-Mar $ 5,000 Bal. Utilities Expense 31-Mar $ 800 Bal. $ 5,400 Bal. $18,700 Bal. $ 800

Aloan Consultants Account Names Cash Accounts Receivable Office Supplies Prepaid Insurance Prepaid Rent Office Equipment Accounts Payable Common Stock Dividends Services Revenue Utilities Expense Totals Unadjusted TB Debit Credit 162,600 8,400 3,200 6,100 12,000 27,200 900 206,100 5,400 18,700 800 225,700 225,700