Question

In: Accounting

Bindy Crawford created a corporation providing legal services, Larkspur, Inc., on July 1, 2022. On July...

Bindy Crawford created a corporation providing legal services, Larkspur, Inc., on July 1, 2022. On July 31 the balance sheet showed: Cash $4,100; Accounts Receivable $3,550; Supplies $730; Equipment $6,050; Accounts Payable $5,250; Common Stock $7,350; and Retained Earnings $1,830. During August the following transactions occurred.

Aug. 1

 Collected $1,080 of accounts receivable due from customers.

4

 Paid $2,750 cash for accounts payable due.

9

 Performed services worth $6,360, of which $3,670 is collected in cash and the balance is due in September.

15

 Purchased additional office equipment for $4,070, paying $440 in cash and the balance on account.

19

 Paid salaries $1,440, rent for August $620, and advertising expenses $370.

23

 Paid a cash dividend of $740.

26

 Borrowed $5,300 from American Federal Bank; the money was borrowed on a 4-month note payable.

31

 Incurred utility expenses for the month on account $400.

Prepare a tabular analysis of the August transactions beginning with July 31 balances. Include margin explanations for any changes in Retained Earnings.

Solutions

Expert Solution

Tabular analysis:

Assets = Liabilities + Shareholders' Equity
Date Cash + Accounts Receivable + Supplies + Equipment = Accounts Payable + Notes Payable + Common Stock + Retained Earnings
Beg. Bal. $4,100 + $3,550 + $730 + $6,050 = $5,250 + + $7,350 + $1,830
Aug. 1 $1,080 + ($1,080) + + = + + +
Aug. 4 ($2,750) + + + = ($2,750) + + +
Aug. 9 $3,670 + $2,690 + + = + + + $6,360
Aug. 15 ($440) + + + $4,070 = $3,630 + + +
Aug. 19 ($2,430) + + + = + + + ($2,430)
Aug. 23 ($740) + + + = + + + ($740)
Aug. 26 $5,300 + + + = + $5,300 + +
Aug. 31 + + + = $400 + + + ($400)
End. Bal. $7,790 + $5,160 + $730 + $10,120 = $6,530 + $5,300 + $7,350 + $4,620

For Retained Earnings, the ending balance is calculated by adding all the revenues to its beginning balance and then deducting all operating expenses along with dividends to reach the ending balance.

ekkarill92 answered 1 year ago
Next > < Previous

Related Solutions

Bindy Crawford created a corporation providing legal services, Sage Hill Inc., on July 1, 2022. On...
Bindy Crawford created a corporation providing legal services, Sage Hill Inc., on July 1, 2022. On July 31 the balance sheet showed: Cash $5,500; Accounts Receivable $4,050; Supplies $860; Equipment $6,550; Accounts Payable $5,750; Common Stock $9,250; and Retained Earnings $1,960. During August the following transactions occurred. Aug. 1 Collected $1,140 of accounts receivable due from customers. 4 Paid $2,620 cash for accounts payable due. 9 Performed services worth $5,560, of which $3,590 is collected in cash and the balance...
On July 31, 2022, the general ledger of Sunland Legal Services Inc. showed the following balances:...
On July 31, 2022, the general ledger of Sunland Legal Services Inc. showed the following balances: Cash $3,520, Accounts Receivable $1,320, Supplies $440, Equipment $4,400, Accounts Payable $3,610, Common Stock $3,080, and Retained Earnings $2,990. During August, the following transactions occurred. Aug. 3 Collected $1,060 of accounts receivable due from customers. 5 Received $1,140 cash for issuing common stock to new investors. 6 Paid $2,380 cash on accounts payable. 7 Performed legal services of $5,720, of which $2,640 was collected...
On July 31, 2022, the general ledger of Sunland Legal Services Inc. showed the following balances:...
On July 31, 2022, the general ledger of Sunland Legal Services Inc. showed the following balances: Cash $3,520, Accounts Receivable $1,320, Supplies $440, Equipment $4,400, Accounts Payable $3,610, Common Stock $3,080, and Retained Earnings $2,990. During August, the following transactions occurred. Aug. 3 Collected $1,060 of accounts receivable due from customers. 5 Received $1,140 cash for issuing common stock to new investors. 6 Paid $2,380 cash on accounts payable. 7 Performed legal services of $5,720, of which $2,640 was collected...
On January 1, 2022, Larkspur, Inc. had these stockholders’ equity balances. Common Stock, $1 par (2,200,000...
On January 1, 2022, Larkspur, Inc. had these stockholders’ equity balances. Common Stock, $1 par (2,200,000 shares authorized, 675,000 shares issued and outstanding) $675,000 Paid-in Capital in Excess of Par Value 1,440,000 Retained Earnings 703,000 Accumulated Other Comprehensive Income 47,000 During 2022, the following transactions and events occurred. 1. Issued 47,500 shares of $1 par value common stock for $4 per share. 2. Issued 57,000 shares of common stock for cash at $6 per share. 3. Purchased 22,100 shares of...
Mike Greenberg opened Bridgeport Window Washing Inc. on July 1, 2022. During July, the following transactions...
Mike Greenberg opened Bridgeport Window Washing Inc. on July 1, 2022. During July, the following transactions were completed. July 1 Issued 12,300 shares of common stock for $12,300 cash. 1 Purchased used truck for $7,600, paying $2,000 cash and the balance on account. 3 Purchased cleaning supplies for $900 on account. 5 Paid $1,800 cash on a 1-year insurance policy effective July 1. 12 Billed customers $3,300 for cleaning services performed. 18 Paid $900 cash on amount owed on truck...
NEWMAN ENTERPRISES, Inc. is a multinational conglomerate corporation providing a wide range of goods and services...
NEWMAN ENTERPRISES, Inc. is a multinational conglomerate corporation providing a wide range of goods and services to its customers. As part of its budgeting process for the next year, it has three mutually exclusive projects under consideration, and it might decide which project should receive the investment funds for this year. As part of the financial analysis team, it is up to you to determine the appropriate valuation of each project. However, before you can determine the appropriate valuations of...
NEWMAN ENTERPRISES, Inc. is a multinational conglomerate corporation providing a wide range of goods and services...
NEWMAN ENTERPRISES, Inc. is a multinational conglomerate corporation providing a wide range of goods and services to its customers. As part of its budgeting process for the next year, it has three mutually exclusive projects under consideration, and it might decide which project should receive the investment funds for this year. As part of the financial analysis team, it is up to you to determine the appropriate valuation of each project. However, before you can determine the appropriate valuations of...
The current sections of Larkspur, Inc.’s balance sheets at December 31, 2021 and 2022, are presented...
The current sections of Larkspur, Inc.’s balance sheets at December 31, 2021 and 2022, are presented here. Larkspur, Inc.’s net income for 2022 was $221,850. Depreciation expense was $39,150. 2022 2021 Current assets    Cash $152,250 $ 143,550    Accounts receivable 116,000 129,050    Inventory 243,600 249,400    Prepaid expenses 39,150 31,900 Total current assets $551,000 $553,900 Current liabilities    Accrued expenses payable $ 21,750 $ 7,250    Accounts payable 123,250 133,400 Total current liabilities $145,000 $ 140,650 Prepare the net cash provided (used) by operating...
Corporation is a private corporation formed for the purpose of providing the products and the services...
Corporation is a private corporation formed for the purpose of providing the products and the services needed to irrigate farms, parks, commercial products, and private homes. It has a centrally located factory in a U.S. city that manufactures the products it markets to retail outlets across the nation. It also maintains a division that provides installation and warranty servicing in six metropolitan areas. The month of November has just ended and Waterways needs to generate a cost of goods manufactured...
Larkspur Golf Inc. was formed on July 1, 2019, when Matt Magilke purchased the Old Master...
Larkspur Golf Inc. was formed on July 1, 2019, when Matt Magilke purchased the Old Master Golf Company. Old Master provides video golf instruction at kiosks in shopping malls. Magilke plans to integrate the instructional business into his golf equipment and accessory stores. Magilke paid $770,000 cash for Old Master. At the time, Old Master’s balance sheet reported assets of $670,000 and liabilities of $210,000 (thus owners’ equity was $460,000). The fair value of Old Master’s assets is estimated to...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT