Question

2,3 Saved Help Save & Exit [The following information applies to the questions displayed below.] On October 1, Ebony Ernst organized Ernst Consulting: on October 3, the owner contributed $83,390 In assets to launch the business. On October 31, the company's records show the following items and amounts. Cash Accounts receivable office supplies Land office equipment Accounts payable Owner investments $13, 210 13,320 2,720 45,910 17,350 7,970 83,390 Cash withdrawals by owner Consulting revenue Rent expense Salaries expense Telephone expense Miscellaneous expenses $ 1,460 13,320 2,950 6,290 830 640 Using the above information prepare an October 31 balance sheet for Ernst Consulting. ERNST CONSULTING Balance Sheet $ 0 BS DA Naut

Answer 1

ERNST CONSULTING
Balance sheet
At October 31
Assets		Liabilities and Owner's Equity
Cash	$13,210	Accounts payable	$7,970
Accounts receivable	$13,320
Office supplies	$2,720	Total liabilities	$7,970
Land	$45,910
Office equipment	$17,350	Owners' Equity:
		Owner investments	$84,540
Total asset	$92,510	Total liabilities and Owner's Equity	$92,510

Calculations:

Income statement
Consulting revenue		$13,320
Expenses:
Rent expense	$2,950
Salaries expense	$6,290
Telephone expense	$830
Miscellaneous expenses	$640
Total expenses		$10,710
Net income		$2,610

.

Owner investments, Beginning	$83,390
Add: Net income	$2,610
(Less): Withdrawal	($1,460)
Owner investments, Ending	$84,540