Camarillo dry cleaners is owned and operated by Kelly camarillo,currently a building and equipment are being rented, pending expansion to new facilities. The actual work of dry cleaning is done by another company at wholesale rates. The assets and the liabilities of the business on November 1 of the current year are as follows: cash $5,400, accounts receivable $18,750, supplies $1,560, land $35,000, accounts payable $5,880, business transactions during November are summarized as follows; a) paid rent for month, $2,450 b) charged customers for dry cleaning sales on account, $7,150 c) paid creditors on account, $1,680 d) purchased supplies on account, $840 e) received cash from customers for dry cleaning sales, $14,600 f) received cash from customers on account, $14,750 g) received monthly invoice for dry cleaning expense for November, (to be paid on December 10) $7,400 h) paid the following; wages expense, $1,800, truck expenses, $510, miscellaneous expense,$190 I) determined that the cost of supplies on hand was $1,350, therefore, the cost of supplies used during the month was $1,050 Instructions 1. Determine the amount of Kelly camarillo's capital as of November 1 of the current year. 2. State the assets, liabilities and owner's equity as of November 1 in equation from similar to that shown in this chapter. In tabular form below the equation, indicate increases and decreases resulting from each transaction and the new balances after each transaction. Explain the nature of the increase and decrease in owner's equity by an appropriate notation at the right of the amount. 3. Prepare an income statement for November, a statement for owner's equity for November, and a balance sheet for November 30.
Camarillo dry cleaners is owned and operated by Kelly camarillo,currently a building and equipment are being rented, pending expansion to new facilities. The actual work of dry cleaning is done by another company at wholesale rates. The assets and the liabilities of the business on November 1 of the current year are as follows: cash $5,400, accounts receivable $18,750, supplies $1,560, land $35,000, accounts payable $5,880, business transactions during November are summarized as follows;
a) paid rent for month, $2,450
b) charged customers for dry cleaning sales on account, $7,150
c) paid creditors on account, $1,680
d) purchased supplies on account, $840
e) received cash from customers for dry cleaning sales, $14,600
f) received cash from customers on account, $14,750
g) received monthly invoice for dry cleaning expense for November, (to be paid on December 10) $7,400
h) paid the following; wages expense, $1,800, truck expenses, $510, miscellaneous expense,$190
I) determined that the cost of supplies on hand was $1,350, therefore, the cost of supplies used during the month was $1,050
Instructions
1. Determine the amount of Kelly camarillo's capital as of November 1 of the current year.
2. State the assets, liabilities and owner's equity as of November 1 in equation from similar to that shown in this chapter. In tabular form below the equation, indicate increases and decreases resulting from each transaction and the new balances after each transaction. Explain the nature of the increase and decrease in owner's equity by an appropriate notation at the right of the amount.
3. Prepare an income statement for November, a statement for owner's equity for November, and a balance sheet for November 30.
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