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) completed these transactions a. Owner Invested $60,000 cash in the company along with equipment that had a $15,000 market value in exchange for its common stock. b. The company paid $1,500 cash for rent of 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 an assistant $3,000 cash as wages for the month. h. The company collected $5,000 cash as a partial payment for the amount owed by the client in transaction e. The company paid $10,000 cash to settle the liability created in transaction J. The company paid $1,000 cash in dividends to the owner (sole shareholder). Book Required: Enter the impact of each transaction on individual items of the accounting equation. (Enter decreases to account balances with a minus sign.) Assets Liabilities Equity Cash Accounts Receivable • Equipment - Accounts Payable Common Stock - Dividends - Revenues - Expenses 0 Bal 0 < Prev 2 of 12 Next >

Answer 1

Answer:

Assets						=	Liabilities	+	Equity
Cash		+	Accounts Receivable	+	Equipment	=	Accounts payable	+	Common Stock	-	Dividends	+	Revenues	-	Expenses
a	$60,000	+		+	$15,000	=		+	$75,000	-		+		-
b	($1,500)	+		+		=		+		-		+		-	$1,500
Bal.	$58,500	+	$0	+	$15,000	=	$0	+	$75,000	-	$0	+	$0	-	$1,500
c		+		+	$10,000	=	$10,000	+		-		+		-
Bal.	$58,500	+	$0	+	$25,000	=	$10,000	+	$75,000	-	$0	+	$0	-	$1,500
d	$2,500	+		+		=		+		-		+	$2,500	-
Bal.	$61,000	+	$0	+	$25,000	=	$10,000	+	$75,000	-	$0	+	$2,500	-	$1,500
e		+	$8,000	+		=		+		-		+	$8,000	-
Bal.	$61,000	+	$8,000	+	$25,000	=	$10,000	+	$75,000	-	$0	+	$10,500	-	$1,500
f	($6,000)	+		+	$6,000	=		+		-		+		-
Bal.	$55,000	+	$8,000	+	$31,000	=	$10,000	+	$75,000	-	$0	+	$10,500	-	$1,500
g	($3,000)	+		+		=		+		-		+		-	$3,000
Bal.	$52,000	+	$8,000	+	$31,000	=	$10,000	+	$75,000	-	$0	+	$10,500	-	$4,500
h	$5,000	+	($5,000)	+		=		+		-		+		-
Bal.	$57,000	+	$3,000	+	$31,000	=	$10,000	+	$75,000	-	$0	+	$10,500	-	$4,500
i	($10,000)	+		+		=	($10,000)	+		-		+		-
Bal.	$47,000	+	$3,000	+	$31,000	=	$0	+	$75,000	-	$0	+	$10,500	-	$4,500
j	($1,000)	+		+		=		+		-	$1,000	+		-
Bal.	$46,000	+	$3,000	+	$31,000	=	$0	+	$75,000	-	$1,000	+	$10,500	-	$4,500