Transactions Using Accrual Accounting
Chris Vining organized The Herbal Shoppe at the beginning of February 20Y4. During February, The Herbal Shoppe entered into the following transactions:
Record the preceding transactions using the integrated financial statement framework. After each transaction, enter a balance for each item. If an amount box does not require an entry, leave it blank. Enter account decreases and net cash outflows as negative amounts.
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1 | Assets | = | Liabilities | + | Stockholder's equity | |||||||
Cash | + | Supplies | + | Prepaid Ins. | = | Accounts Payable | + | Capital Stock | + | Retained Earnings | ||
a | Investment | $25,000 | $25,000 | |||||||||
b | Paid Insurance | -$4,200 | $4,200 | |||||||||
Balance | $20,800 | $0 | $4,200 | $0 | $25,000 | $0 | ||||||
c | Purchased supplies | $1,200 | $1,200 | |||||||||
Balance | $20,800 | $1,200 | $4,200 | $1,200 | $25,000 | $0 | ||||||
d | Fees earned | $36,500 | $36,500 | |||||||||
Balance | $57,300 | $1,200 | $4,200 | $1,200 | $25,000 | $36,500 | ||||||
e | Paid expenses | -$16,100 | -$16,100 | |||||||||
Balance | $41,200 | $1,200 | $4,200 | $1,200 | $25,000 | $20,400 | ||||||
f | Paid dividends | -$7,500 | -$7,500 | |||||||||
Balance | $33,700 | $1,200 | $4,200 | $1,200 | $25,000 | $12,900 | ||||||
2 | Statement of Cash Flows | |||||||||||
a | Financing | $25,000 | ||||||||||
b | Operating | -$4,200 | ||||||||||
d | Operating | $36,500 | ||||||||||
e | Operating | -$16,100 | ||||||||||
f | Financing | -$7,500 | ||||||||||
Increase in Cash | $33,700 | |||||||||||
3 | Income Statement | |||||||||||
d | Fees Earned | $36,500 | ||||||||||
e | Wages exp. | -$12,000 | ||||||||||
e | Rent exp. | -$2,000 | ||||||||||
e | Utilities exp. | -$1,000 | ||||||||||
e | Misc. exp. | -$1,100 | ||||||||||
Net Income | $20,400 |
Transactions Using Accrual Accounting Chris Vining organized The Herbal Shoppe at the beginning of February 20Y4....
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