Question

Semester Case - My Assistant At end of July, a family friend, who is an attorney, helped W.L. incorporate My Assistant W.1, invested $100 of his own money into the company in exchange for common stock. The company opened a business checking account with the $100. During August, things went better than expected and W.L. was able to complete 60 jobs. Fitting those into the schedule was in no small part due to efficient scheduling by his social media manager. This efficiency in scheduling also lead to lower than expected gas costs. During August, the following transactions were completed: 1. Received $900 in exchange for completing the 60 jobs. less a $44 fee due to PayPal. 2. Purchased gas of $150 so he could complete the jobs. 3. Paid the newspaper $120 for advertising for the month. 4. Paid the social media manager $160 for her total fee for the month, 5. Paid a salary to himself. Your group should discuss and decide: what is a reasonable salary Remember, no part of his income for the next few months is guaranteed. For each of the above transactions, 1. Either collect or pay the appropriate amount of cash. You will be provided with access to the business checking account. Cash from customers and payments to other parties can be made at the front of the room. 2. Record the transactions in the appropriate general accounts. Record the amounts of revenue and expense in the Retained Earnings column. Provide the appropriate titles for these accounts in the last column of the table. For the sake of simplicity, at this point, use the account title. "Operating Expenses" for all expenses. 3. As of August 31. determine the total amount of assets. liabilities, and stockholder's equity and present this information in the form of an accounting equation. 4. What is the amount of total assets, liabilities, and stockholders' equity as of September 12 = Account titles for RE Assets Cash $100 $100 My Assistant Accounting Equation for August Liabilities + Stockholders' Equity Common Retained n/a Stock Earnings $100 $100 = Issue Stock Balance August 1 1. Complete jobs 2. Purchase gas 3. Pay newspaper 4. Pay soc. media mgr. 5. Pay self salary Balance August 31

Answer 1

My Assistant
Accounting Equation for August
	Assets	=	Liabilties	+	Stockholders' Equity			Account titles for RE
	Cash	=	n/a	+	Common Stock	+	Retained Earnings
Issue Stock	$100				$100
Balance August 1	$100	=		+	$100	+
1. Complete jobs	$856						$856	Service Revenue
2. Purchase gas	-$150						-$150	Operating Expense
3. Pay newspaper	-$120						-$120	Operating Expense
4. Pay soc. Media mgr.	-$160						-$160	Operating Expense
5. Pay self salary	-
Balance August 31	$526	=		+	$100	+	$426
Balance September 1	$526				$100		$426
Note: Pay self salary figure is not yet given so no effect of that