P1-2A Analyze transactions and prepare income statement, owner's equity statement, and balance...

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P1-2A Analyze transactions and prepare income statement, owner's equity statement, and balance sheet Sonya Jared opened a law office on July 1, 2020. On July 31, the balance sheet showed Cash $5,000, Accounts Receivable $1,500, Supplies $500, Equipment $6,000, Accounts Payable $4,200 and Owner's Capital $8,800. During August, the following transactions occurred. 1. Collected $1,100 of accounts receivable. 2. Paid $2,800 cash on accounts payable. 3. Recognized revenue of $7,500 of which $4,000 is collected in cash and the balance is due in September. 4. Purchased additional equipment for $2,000, paying $400 in cash and the balance on account. 5. Paid salaries $2,800, rent for August $900, and advertising expenses $400. 6. Withdrew $800 in cash for personal use. 7. Received $2,000 from Standard Federal Bank - money borrowed on a note payable. 8. Incurred utility expenses for month on account $270. Instructions (a) Prepare a tabular analysis of the August transactions beginning with July 31 balances. The column headings should be as follows: Cash + Accounts Receivable + Supplies + Equipment = Notes Payable + Accounts Payable + Owner's Capital - Owner's Drawings + Revenue - Expenses. (b) Prepare an income statement for August, an owner's equity statement for August and a balance sheet at August 31. NOTE: Enter a number in cells requesting a value; enter either a number or a formula in cells with a "?" .

Bhavani · Accepted Answer

P1-1A
	P1-1A  Analyze transactions and compute net income 
	On April 1, Julie Spengel established Spengel's Travel Agency.  The following transactions were
	completed during the month.
	1. 	Invested  $18,000 cash to start the agency.
	2	Paid $750 cash for April office rent.
	3.	Purchased equipment for $3,000 cash.
	4.	Incurred $700 of advertising costs in the Chicago Tribune, on account.
	5.	Paid $900 cash for office supplies.
	6.	Performed services worth $15,000:  $7,000 cash is received from customers, and the 
		balance is billed to customers on account.
	7.	Withdrew $500 cash for personal use.
	8.	Paid Chicago Tribune $500 of the amount due in transaction (4).
	9.	Paid employees' salaries $2,000.
	10.	Received $4,000 in cash from customers who have previously been billed in  
		transaction (6).
	Instructions
	(a)	Prepare a tabular analysis of the transactions using the following column headings:
		Cash, Accounts Receivable, Supplies, Equipment, Accounts Payable, Owner's Capital,
		Owner's Drawings, Revenues, and  Expenses.
	(b)	From an analysis of the owner's equity columns, compute the net income or net loss for April.
	NOTE:  Enter a number in cells requesting a value; enter either a number or a formula in cells with a "?" .
	(a)	SPENGEL'S TRAVEL AGENCY
												Owner's Equity
				Accounts						Accounts		Owner's		Owner's 
		Cash	+	Receivable	+	 Supplies	+	 Equipment	=	Payable	+	Capital	-	Drawings	+	Revenues	-	Expenses
	1.	$18,000										18,000
		18,000							=			18,000
	2.	-750																750
		17,250							=			18,000					-	750
	3.	-3,000						$   3,000
		14,250					+	3,000	=			18,000					-	750
	4.									$   700								750
		14,250					+	3,000	=	700	+	18,000					-	700
	5.	-900				900
		13,350			+	900	+	3,000	=	700	+	18,000					-	1,450
	6.	7,000		8,000												15,000
		20,350	+	8,000	+	900	+	3,000	=	700	+	18,000			+	15,000	-	1,450
	7.	-500								700				500
		19,850	+	8,

P1-2A Analyze transactions and prepare income statement, owner's equity statement, and balance sheet Sonya Jared opened a law office on July 1, 2020. On July 31, the balance sheet showed Cash $5,000,...

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