Problem

Yi Min started an engineering firm called Min Engineering. He began operations and compl...

Yi Min started an engineering firm called Min Engineering. He began operations and completed seven transactions in May, which included his initial investment of $18,000 cash. After those seven transactions, the ledger included the following accounts with normal balances.

Cash . . . . . . . . . . . . . . . . . . . . . $44,132

Office supplies . . . . . . . . . . . . . . 1,090

Prepaid insurance . . . . . . . . . . . . 4,700

Office equipment . . . . . . . . . . . . 11,200

Accounts payable . . . . . . . . . . . . 11,200

Y. Min, Capital . . . . . . . . . . . . . . 18,000

Y. Min,Withdrawals . . . . . . . . . . . 4,328

Engineering fees earned . . . . . . . 44,000

Rent expense . . . . . . . . . . . . . . . 7,750

Required

1. Prepare a trial balance for this business as of the end of May.

Analysis Components

2. Analyze the accounts and their balances and prepare a list that describes each of the seven most likely transactions and their amounts.

3. Prepare a report of cash received and cash paid showing how the seven transactions in part 2 yield the $44,132 ending Cash balance.

Step-by-Step Solution

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