Question

Problem 3-01 (Part Level Submission) Listed below are the transactions of Gary King, D.D.S., for the month of September. Sept. 1 King begins practice as a dentist, invests $20,600 cash and issues 2,060 shares of $10 par stock. 2 Purchases dental equipment on account from Green Jacket Co. for $18,780. 4 Pays rent for office space, $640 for the month. 4 Employs a receptionist, Michael Bradley. 5 Purchases dental supplies for cash, $940. 8 Receives cash of $1,860 from patients for services performed. 10 Pays miscellaneous office expenses, $380. 14 Bills patients $5,850 for services performed. 18 Pays Green Jacket Co. on account, $3,740. 19 Pays a dividend of $3,100 cash. 20 Receives $920 from patients on account. 25 Bills patients 150 for services performed. 30 Pays the following expenses in cash: Salaries and wages $1,680; miscellaneous office expenses $88. 30 Dental supplies used during September, $370. Record depreciation using a 5-year life on the equipment, the straight-line method, and no salvage value.

Answer 1

$ 9,860 GARY KING, D.D.S. Income Statement For the Month Ended September 30 Service Revenue Expenses: Rent Expense 640 Supplies Expense 370 Depreciation Expense 313 Salaries and Wages Expense 1,680 Office Expense S 468 Total Expenses Net Income /(Loss) $ $ 3,471 6,389

Cost of Equipment = $18,780
Useful Life = 5 years

Annual Depreciation = Cost of Equipment / Useful Life
Annual Depreciation = $18,780 / 5
Annual Depreciation = $3,756

Monthly Depreciation = Annual Depreciation / 12
Monthly Depreciation = $3,756 / 12
Monthly Depreciation = $313