Question

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Gabi Gram started The Gram Co., a new business that began operations on May 1. The Gram Co. completed the following transactions during its first month of operations.

May		1		G. Gram invested $43,500 cash in the company.
		1		The company rented a furnished office and paid $2,600 cash for May’s rent.
		3		The company purchased $4,210 of office equipment on credit.
		5		The company paid $730 cash for this month’s cleaning services.
		8		The company provided consulting services for a client and immediately collected $5,400 cash.
		12		The company provided $2,400 of consulting services for a client on credit.
		15		The company paid $730 cash for an assistant’s salary for the first half of this month.
		20		The company received $2,400 cash payment for the services provided on May 12.
		22		The company provided $3,600 of consulting services on credit.
		25		The company received $3,600 cash payment for the services provided on May 22.
		26		The company paid $4,210 cash for the office equipment purchased on May 3.
		27		The company purchased $80 of advertising in this month’s (May) local paper on credit; cash payment is due June 1.
		28		The company paid $730 cash for an assistant’s salary for the second half of this month.
		30		The company paid $350 cash for this month’s telephone bill.
		30		The company paid $250 cash for this month’s utilities.
		31		G. Gram withdrew $1,800 cash from the company for personal use.

Required:

1. Enter the amount of each transaction on individual items of the accounting equation. Do not determine new account balances after each transaction. (Enter the transactions in the given order. Enter reductions to account balances with a minus sign.)

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Answer 1

Accounting equation is as prepared below:

	Assets				Liabilities		Equity
Date	Cash	Account Receivable	Office Equipment	=	Accounts payable	+	G Gram capital	-	G Gram Withdrawal	+	Revenues	-	Expenses
May-01	43,500			=		+	43,500	-		+		-
May-01	-2,600			=		+		-		+		-	2,600
May-03			4,210	=	4,210	+		-		+		-
May-05	-730			=		+		-		+		-	730
May-08	5,400			=		+		-		+	5,400	-
May-12		2,400		=		+		-		+	2,400	-
May-15	-730			=		+		-		+		-	730
May-20	2,400	-2,400		=		+		-		+		-
May-22		3,600		=		+		-		+	3,600	-
May-25	3,600	-3,600		=		+		-		+		-
May-26	-4,210			=	-4,210	+		-		+		-
May-27				=	80	+		-		+		-	80
May-28	-730			=		+		-		+		-	730
May-30	-350			=		+		-		+		-	350
May-30	-250			=		+		-		+		-	250
May-31	-1,800			=		+		-	1,800	+		-
Balance	43,500	0	4,210	=	80	+	43,500	-	1,800	+	11,400	-	5,470