a)
ASSET | = | LIABILITIES | + | STOCKHOLDERS EQUITY | ||||||||||||||
Retained earning | ||||||||||||||||||
2017 | cash | + | Accounts receivable | = | Accounts payable | + | Interest payable | + | salaries and wage payable | + | common stock | + | Revenue | - | expense | - | Dividend | |
Dec 31 | 450 | 450 | expense | |||||||||||||||
Dec 31 | 2120 | 2120 | Expense | |||||||||||||||
Dec 31 | 199 | 199 | expense | |||||||||||||||
Dec31 | 320 | 320 | revenue | |||||||||||||||
Dec 31 | 6360 | 6360 | revenue | |||||||||||||||
Total | 0 | + | 6680 | = | 450 | + | 199 | + | 2120 | + | 0 | + | 6680 | - | 2769 | - | 0 |
**
2)Salary accrued for 4 days out of 7 days : 3710*4/7 = 2120
3)Interest accrued on note for one month : 47700*.05*1/12 = 198.75 (rounded to 199)
b)
ASSET | = | LIABILITIES | + | STOCKHOLDERS EQUITY | ||||||||||||||
Retained earning | ||||||||||||||||||
2018 | cash | + | Accounts receivable | = | Accounts payable | + | Interest payable | + | salaries and wage payable | + | common stock | + | Revenue | - | expense | - | Dividend | |
Jan 11 | -450 | -450 | ||||||||||||||||
Jan 4 | -3710 | -2120 | 1590 [3710*3/7] | expense for 3 days of Jan | ||||||||||||||
Jan 1 | -199 | -199 | ||||||||||||||||
Jan 4 | 320 | -320 | ||||||||||||||||
Jan 2 | 6360 | -6360 |
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