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Ali Omar opened a yard care business, Omar’s Yard Care, on March 31, 2020. The following...

Ali Omar opened a yard care business, Omar’s Yard Care, on March 31, 2020. The following activities occurred during his first month of operations: Ali Omar invested $5,600 cash and $21,500 of equipment to start his business, Omar’s Yard Care. Purchased various supplies on account; $2,900. Bought supplies on credit; $1,080. Omar signed a $5,300 contract to do yard work beginning in May. Did work for a client on account; $680. Performed services for a customer on credit; $1,250. Paid $330 for the supplies purchased in (c). Paid $380 for advertising online. Collected the amount owed from the customer in (f). Using the format, show the effects of the activities listed in (a) through (i). 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.)

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Expert Solution

Assets   = Liabilities   + Equity  
Cash   Account Receivable   Supplies   Equipments Accounts Payable All, Capital   Explanations  
a.   + $   5,600.00 + $       21,500.00 + $      27,100.00 Equity capital increases  
b.   + $      2,900.00 + $            2,900.00 No effect on equity  
c.   + $      1,080.00 + $            1,080.00 No effect on equity  
d. $                -   $                -   $                   -   $                       -   $                         -   $                     -   No effect on equity  
e. + $       680.00 + $            680.00 Retained earnings (Service Revenue ) increases  
f. + $   1,250.00 + $        1,250.00 Retained earnings (Service Revenue ) increases  
g. - $      330.00 - $                330.00 No effect on equity  
h. - $      380.00 - $            380.00 Retained earnings (Advertising Expense ) decreases  
i. + $   1,250.00 - $   1,250.00 No effect on equity  
Totals   + $   6,140.00 + $       680.00 + $      3,980.00 + $       21,500.00 + $            3,650.00 + $      28,650.00
+32300 +32300

ekkarill92 answered 1 year ago
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