Question

Natalie Gold is the owner of the marketing agency Vivid Voice. The company focuses on online consulting services, such as online marketing campaigns and blog services. The June transactions for Vivid Voice resulted in totals at June 30, 2020, as shown in the following accounting equation format:

Assets = Liabilities + Equity

Cash + Accounts Receivable + Supplies + Equipment = Accounts Payable + Natalie Gold,Capital Explanation of Equity Transaction

$8,000 + $3,200 + $3,900 + $8,500 = $6,000 + $17,600

During July, the following occurred:

Collected $1,000 from a credit customer.

Paid $3,500 for equipment purchased on account in June.

Did work for a client and collected cash; $3,100.

Paid a part-time consultant’s wages; $1,150.

Paid the July rent; $3,200.

Paid the July utilities; $1,600.

Performed services for a customer on credit; $2,600.

Called an information technology consultant to fix the agency’s photo editing software in August; it will cost $550.

1. Show the effects of the activities listed in (a) through (h). For each transaction that affects equity, select the appropriate description beside it (owner investment, owner withdrawal, revenue, expenses provided in the dropdown). (Enter all amounts as positive values. If the transaction/event does not affect equity or do not require a journal entry, select "No Affect on Equity" in the 'Explanation of equity transaction' field.)

2. Prepare an income statement for July 2020.

3. Prepare an statement of changes in equity for July 2020.

4. Prepare an balance sheet for July 2020.

Analysis Component:

Review Gold’s balance sheet. How much of the assets are financed by Gold? How much of the assets are financed by debt? (Do not round intermediate calculations.)

Answer 1