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 $61.000 cash in the company along with equipment that had a $13.000 market value in exchange for its common stock. b. The company paid $3.000 cash for rent of office space for the month. c. The company purchased $18.000 of additional equipment on credit (payment due within 30 days). d. The company completed work for a client and immediately collected the $1.600 cash earned. e. The company completed work for a client and sent a bill for $8.500 to be received within 30 days. f. The company purchased additional equipment for $5,100 cash. g. The company paid an assistant $2.000 cash as wages for the month. h. The company collected $5,700 cash as a partial payment for the amount owed by the client in transaction e. i. The company paid $18.000 cash to settle the liability created in transaction c. j. The company paid $1,400 cash in dividends to the owner (sole shareholder). 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 S 15,000 = $ 75,000 1,500 1,500 + 1,500 + 15,000 = 75.000 1,500 Bal. 1,500 + 15,000 = 75,000 - 1,500 Bal. 1,500 + 15,000 = 75,000 - 1.500 Bal. 1,500 + 15,000 = 75,000 1,500 1.500 + 15.000 = 75,000 - 1.500 Bal. 1,500 + 15,000 = 75,000 - 1,500 Bal. 1,500 + 15,000 = 75,000 - 1,500 15,000 = 75,000 - 1,500 Bal. j. Bal. 1,500 1,000 2.500 + + + S S 0 + $ 15,000 = $ | $ 75,000 - S S 1,500

Answer 1

	Assets				Liabilities	Equity
	Cash	A/R	Equipment	=	A/P	C Stock	Dividends	Revenues	Expenses
a	61,000		13,000			74,000
b	-3,000								3,000
Bal	58,000	0	13,000		0	74,000	0	0	3,000
c			18,000		18,000
bal	58,000	0	31,000		18000	74,000	0	0	3,000
d	1,600							1,600
bal	59,600	0	31,000		18000	74,000	0	1600	3,000
e		8,500						8,500
bal	59,600	8500	31,000		18000	74,000	0	10100	3,000
f	-5,100		5,100
bal	54,500	8500	36,100		18000	74,000	0	10100	3,000
g	-2,000								2,000
bal	52,500	8500	36,100		18000	74,000	0	10100	5,000
h	5,700	-5,700
bal	58,200	2800	36,100		18000	74,000	0	10100	5,000
i	-18,000				-18,000
bal	40,200	2800	36,100		0	74,000	0	10100	5,000
j	-1,400						1,400
bal	38,800	2800	36,100		0	74,000	1,400	10100	5,000