a kitchen and bath design conference in August 2020. He will send a $1000 deposit on July 1 2020. f. Completed a project on credit and billed the client $ 5200 for the work g. Paid a local online newspaper $3500 for an announcement
George Littlechild started a new kitchen and bath designs business called Littlechild Enterprises. The following activities occurred during its first month of operations, March 2020:
a. little child invested 160000 cash and office equipment valued at $20000 in the business
b. Purchased a small building for $600000 to be used as an office. Paid $100000 in cash and signed a note payable promising to pay the balance over several years.
c. Purchased $3000 of office supplies for cash.
d. Purchased 72000 of office equipment on credit
e. Littlechild made reservations at a hotel hosting a kitchen and bath design conference in August 2020. He will send a $1000 deposit on July 1 2020.
f. Completed a project on credit and billed the client $ 5200 for the work
g. Paid a local online newspaper $3500 for an announcement that the office had opened.
h. Completed a project for a client and collected $4000 cash.
i. Made a $4000 payment on the equipment purchased in d
j. Reserved $ 2500 from the client described in f
k. Paid $7000 cash for the office secretary wages
l. Little child withdrew $3600 cash from the company bank account to pay personal living expenses.
Required:
1. Create a table using the following heading for the columns: Cash, AR, Office supplies, office equipment, building, AP, NP, and Capital for Littlechild. Leave space for an explanation of Equity Transaction column to the right of the Capital column. Identify revenues and expenses by name in the explanation of Equity Transaction column.
2. Use additions and subtraction to show the transactions effect on the elements of the equation. Do not determine new totals for the items of the equation after each transaction. Next change in equity, state whether the change was caused by an invest a revenue, an expense or a withdrawal. Determine the final total for each item and verify that the equation is in balance.
3. Prepare an income statement, a statement of changes in equity and balance sheet.
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