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MASTERY PROBLEM
Lisa Vozniak started her own business, We Do Windows. She offers
interior and exterior window cleaning for local area residents. Lisa rents
a garage to store her tools and cleaning supplies and has a part-time
assistant to answer the phone and handle third-story work. (Lisa is
afraid of heights.) The transactions for the month of July are as follows:
(a) Lisa invested cash by making a deposit in a bank account for the
business, $8,000.
(b) Paid rent for July, $150.
(c) Purchased a used van for cash, $5,000.
(d) Purchased tools on account from Clean Tools, $600.
(e) Purchased cleaning supplies that cost $300. Paid $200 cash and will
pay the balance next month, $100.
(f) Paid part-time assistant (wages) for first half of month, $100.
(g) Paid for advertising, $75.
(h) Paid two-year premium for liability insurance on van, $480.
(i) Received cash from clients for services performed, $800.
(j) Performed cleaning services for clients on account, $500.
k) Paid phone bill, $40.
(1) Received cash from clients for window cleaning performed on
account in transaction (j), $200.
(m) Paid part-time assistant (wages) for last half of month, $150.
(n) Made partial payment on tools purchased in transaction (d), $200.
(0) Earned additional revenues amounting to $800: $600 in cash and $200
on account.
(p) Vozniak withdrew cash at the end of the month for personal
expenses, $100.
REQUIRED
1. Enter the above transactions in an
one illustrated below.
2. After transaction (p), compute the balance of each account.
3. Prepare an income statement for We Do Windows for the month of
July 20-.
4. Prepare a statement of owner's equity for We Do Windows for the
month of July 20-.
5. Prepare a
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