Question

A list of accounts and their balances of O’Neill’s Psychological Services, at its year end July 31, 2021, is presented below:

Supplies		$790
Unearned Revenue		1,070
Supplies Expense		5,930
Cash		6,435
Accounts Receivable		7,335
Accounts Payable		9,100
Rent Expense		10,840
Notes Payable		22,750
Salaries Expense		45,000
T. O’Neill, Drawings		57,300
Equipment		58,550
T. O’Neill, Capital		65,300
Service Revenue		93,960

Prepare balance sheet.

Answer 1

O’Neill’s Psychological Services
BALANCE SHEET
AS OF July 31, 2021
	$	$
Assets
Current Assets
Cash	6,435.00
Accounts receivable	7,335.00
Supplies	790.00
Total current assets		14,560.00
Property, plant and equipment
Equipment		58,550.00
Total assets		73,110.00
Liabilities and stockholders’ equity
Current liabilities
Accounts payable	9,100.00
Note Payable	22,750.00
Unearned Revenue	1,070.00
Total Current liabilities		32,920.00
Stockholders’ equity
Owner's capital		40,190.00
Total stockholders’ equity		40,190.00
Total liabilities and stockholders’ equity		73,110.00
Explanation
O’Neill’s Psychological Services
Income Statement
For the Year Ended July 31, 2021
	$	$
Revenue:
Service revenue	93,960.00
Total Revenue		93,960.00
Less Expenses:
Salaries expense	45,000.00
Supplies Expenses	5,930.00
Rent expense	10,840.00
Total Expenses		61,770.00
Net Income (Loss)		32,190.00
O’Neill’s Psychological Services
Statement of Owner’s Equity
For the Year Ended July 31, 2021
	$
T. O’Neill, Capital, July 31, 2020	65,300.00
Add: Net income	32,190.00
	97,490.00
Less: Withdrawals during the year	(57,300.00)
T. O’Neill, Capital, July 31, 2021	40,190.00