Question

The accountant for the firm owned by Randy Guttery prepares financial statements at the end of each month. The following transactions for Randy Guttery, Landscape Consultant took place during the month ended June 30, 2019. Transactions: a. Guttery invested $143,000 in cash to start the business. b. Paid $4,300 for the current month's rent. c. Bought office furniture for $15,020 in cash. d. Perfo d services for $8,900 in cash. e. Paid $1,080 for the monthly telephone bill. f. Performed services for $14,700 on credit. g. Purchased a computer and copler for $34,600; paid $11,300 in cash immediately with the balance due in 30 days. h. Received $7,350 from credit clients. 1. Paid $2,300 in cash for office cleaning services for the month. J. Purchased additional office chairs for $4,100; received credit terms of 30 days. k. Purchased office equipment for $23,000 and paid half of this amount in cash immediately; the balance is due in 30 days. 1. Issued a check for $7700 to pay salaries. m. Performed services for $15,200 in cash. n. Performed services for $16,700 on credit. 0. Collected $6,300 on accounts receivable from charge customers. p. Issued a check for $2,050 in partial payment of the amount owed for office chairs. 9. Paid $530 to a duplicating company for photocopy work performed during the month. Paid $1,050 for the monthly electric bill. s. Guttery withdrew $7,300 in cash for personal expenses. Required: Prepare a trial balance, an income statement, a statement of owner's equity, and a balance sheet. Assume that the transactions took place during the month ended June 30, 2019. Determine the account balances before you start work on the financial statements.

Answer 1

A G H INCOME STATEMENT Revenue BALANCE SHEET BALANCE SHEET 55500 Amount Less: Expenses Telephone Rent Electricity Office cleaning Photocopy Salaries - 1080 -4300 -1050 -2300 -530 -7700 Particulars Assets Current Assets Cash Accounts receivable Total Current Assets 116620 17750 134370 Profit 38540 TRIAL BALANCE Particulars Debit Credit Cash(143000-4300-15020+8900-1080- 11300+7350-2300-11500-7700+15200+6300-2050 116620 Guttery's capital(143000-7300) 135700 Telephone bill 1080 Rent expense 4300 Office furniture 19120 Computer equipmento 34600 Accounts payable(23300-4100+11500-2050) 36850 Office equipment 23000 Electric bill 1050 Service revenue (8900+14700+15200+16700) 55500 Accounts receivable (14700-7350+16700-6300 17750 Office cleaning expense 2300 Photocopy expense 530 5 Salaries expense 7700 7 228050 228050 3 STATEMENT OF OWNER EQUITY Beginning balance 0 Capital invested 143000 2 Less: Withdrawl -7300 3 Profit 38540 Total 174240 5 Fixed Assets Office equipment Office furniture Computer equipment Total fixed assets 23000 19120 34600 76720 211090 TOTAL ASSETS Liabilities and equity Current Liabilities Accounts Payable Total Current Liabilities 36850 36850 Equity Guttery's capital Retained earnings Total equity 135700 38540 174240 6 7 TOTAL 211090