EFFECT OF TRANSACTIONS ON ACCOUNTING EQUATION Jay Pembrokestarted a business. During the first month (April 20--), the followingtransactions occurred (a) Invested cash in business, $18,000.(b) Bought office supplies for $4,600: $2,000 in cash and $2,600 onaccount.(c) Paid one-year insurance premium, $1,200. (d) Earned revenues totaling $3,300: $1,300 in cash and $2,000 onaccount.(e) Paid cash on account to the company that supplied the office suppliesin transaction (b), $2,300.(f) Paid office rent for the month, $750. (g) Withdrew cash for personal use, $100. REQUIREDShow the effect of each transaction on the individual accounts of theexpanded accounting equation: Assets = Liabilities + Owner's Equity (Capital - Drawing + Revenues - Expenses). After transaction (g), reportthe totals for each element. Demonstrate that the accounting equationhas remained in balance.STATEMENT OF OWNER'S EQUITY Based on Problem, prepare astatement of owner's equity for Jay Pembroke for the month of April 20--.
EFFECT OF TRANSACTIONS ON
started a business. During the first month (April 20--), the following
transactions occurred
(a) Invested cash in business, $18,000.
(b) Bought office supplies for $4,600: $2,000 in cash and $2,600 on
account.
(c) Paid one-year insurance premium, $1,200.
(d) Earned revenues totaling $3,300: $1,300 in cash and $2,000 on
account.
(e) Paid cash on account to the company that supplied the office supplies
in transaction (b), $2,300.
(f) Paid office rent for the month, $750.
(g) Withdrew cash for personal use, $100.
REQUIRED
Show the effect of each transaction on the individual accounts of the
(Capital - Drawing + Revenues - Expenses). After transaction (g), report
the totals for each element. Demonstrate that the accounting equation
has remained in balance.
STATEMENT OF OWNER'S EQUITY Based on Problem, prepare a
statement of owner's equity for Jay Pembroke for the month of April 20--.
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