e1-8 a increase asset (cash) increase owner’s equity (capital) b increase asset (supplies)...
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E1-8A Increase asset (Cash)
Increase owner’s equity (Capital)
B Increase asset (Supplies)
Decrease asset (Cash)
C Increase asset (Accounts Receivable)
Increase owner’s equity (Rental Revenue)
D Increase asset (Office Furniture)
Increase liability (Accounts Payable)
E Increase asset (Cash)
Decrease asset (Accounts Receivable)
F Decrease asset (Cash)
Decrease liability (Accounts Payable)
G Increase asset (Cash)
Decrease asset (Land)
H Increase asset (Cash)
Increase owner’s equity (Rental Revenue)
I Decrease asset (Cash)
Decrease owner’s equity (Rent Expense)
JD’s Graphic Design
Balance Sheet
November 30, 20X9
ASSETS LIABILITIES
Cash $ 2,000 Accounts payable $ 2,500
Accounts receivable 6,900 Note payable 8,000
Supplies 600 Total liabilities 10,500
Office equipment 15,500 OWNER’S EQUITY
J.D. Power, capital 14,500*
Total liabilities and
Total assets $25,000 owner’s equity $25,000
E1-11
Award Specialties
Income Statement
Year Ended December 31, 20X6
Revenue:
Service revenue $161,200
Expenses:
Salary expense $60,000
Rent expense 24,000
Utilities expense 6,800
Supplies expense 4,000
Property tax expense 1,200
Total expenses 96,000
Net income $ 65,200
E1-12
Award Specialties
Statement of Owner’s Equity
Year Ended December 31, 20X6
Capital, beginning of year $ -0-
Add:Investment by owner 15,000
Net income for the year (Req. 1) 65,200
80,200
Less: Withdrawals by owner (53,100)
Capital, end of year $ 27,100
Peavy Design
Income Statement
Month Ended May 31, 20X5
Revenues:
Service revenue ($1,100 + $5,000) $6,100
Expenses:
Rent expense $1,200
Advertising expense 660
Total expenses 1,860
Net income $4,240
P1-2A 2
Peavy Design
Statement of Owner’s Equity
Month Ended May 31, 20X5
Daniel Peavy, capital, April 30, 20X5 $23,660
Add: Investments by owner ($12,000 + $1,700)
13,700
Net income for the month 4,240
41,600
Less: Withdrawals by owner (4,000)
Daniel Peavy, capital, May 31, 20X5 $37,600
Peavy Design
Balance Sheet
May 31, 20X5
ASSETS LIABILITIES
Cash $ 6,090 Accounts payable $ 720
Accounts receivable 7,490
Supplies 640 OWNER’S EQUITY
Land 24,100
Daniel Peavy, capital 37,600
Total liabilities and
Total assets $38,320 owner’s equity $38,320
Vail Financial Consultants
Income Statement
Year Ended December 31, 20X4
Revenue:
Service revenue $108,000
Expenses:
Salary expense $38,000
Rent expense 14,000
Interest expense 4,000
Utilities expense 3,000
Property tax expense 2,000
Total expenses 61,000
Net income $ 47,000
P1-5A
Vail Financial Consultants
Statement of Owner’s Equity
Year Ended December 31, 20X4
Matthew Vail, capital, December 31, 20X3 $43,000
Add: Net income for the year 47,000
90,000
Less: Withdrawals by owner (32,000)
Matthew Vail, capital, December 31, 20X4 $58,000
Vail Financial Consultants
Balance Sheet
December 31, 20X4
ASSETS LIABILITIES
Cash $ 7,000 Accounts payable $ 12,000
Accounts receivable 3,000 Interest payable 1,000
Supplies 7,000 Note payable 31,000
Equipment 21,000 Total liabilities 44,000
Building 56,000 OWNER’S EQUITY
Land 8,000
Matthew Vail, capital
58,000*
Total liabilities and
Total assets $102,000 owner’s equity $102,000
a. Result of operations: Net income of $47,000b. The owner increased the company’s capital. Net income ($47,000) exceeded withdrawals by the owner ($32,000).This would make it easier to borrow because the business’s equity is growing.
c Total economic resources (total assets)…… $102,000
– Total amount owed (total liabilities)……… (44,000)
= Owner’s equity…………………………….. $ 58,000
Bellmead Auto Repair
Income Statement
Year Ended December 31, 20X8
Revenue:
Service revenue $101,000
Expenses:
Salary expense $42,000
Rent expense 8,000
Fuel expense 6,000
Insurance expense 4,000
Supplies expense 1,000
Total expenses 61,000
Net income $40,000
Bellmead Auto Repair
Statement of Owner’s Equity
Year Ended December 31, 20X8
Owner, capital, December 31, 20X7 $13,000
Add: Net income for the year 40,000
53,000
Less: Withdrawals by owner (36,000)
Owner, capital, December 31, 20X8 $17,000
Bellmead Auto Repair
Balance Sheet
December 31, 20X8
ASSETS LIABILITIES
Cash $16,000 Accounts payable $ 8,000
Accounts receivable 7,000
Supplies 2,000 OWNER’S EQUITY
Owner, capital 17,000
Total liabilities and
Total assets $25,000 owner’s equity $25,000