Trixie Maye started her own consulting firm, Matrix Consulting, on May 1, 2018. The following transactions occurred during the month of May
- Trixie invested $7,000 cash in the business.
- Paid $900 for office rent for the month
- Purchased $600 for office rent for the month
- Paid $125 to advertise in the County News.
- Received $4,000 cash for services performed.
- Withdrew $1,000 cash for personal use
- Performed $5,400 of services on account.
- Paid $2,500 for employee salaries.
- Paid for the supplies purchased on account on May 3.
- Received a cash payment of $4,000 for services performed on account on May 15.
- Borrowed $5,000 from the bank on a note payable.
- Purchased equipment for $4,200 on account.
- Paid $275 for utilities
Instructions
- Show the effects of the previous transactions on the accounting equation using the following format:
Date Assets Cash + Accounts Receivable + Supplies + Equipment = Liabilities Notes Payable + Accounts Payable + Owner's Equity Owner's Capital - Owner's Drawings + Revenues - Expenses. - Prepare an income statement for the month of May
- Prepare a balance sheet at May 31,2018
Solution
(i)
(ii)
(iii)
