Answered: Instructions 1. Indicate the effect of…

College Accounting (Book Only): A Career Approach

13th Edition

ISBN:9781337280570

Author:Scott, Cathy J.

Publisher:Scott, Cathy J.

Chapter3: The General Journal And The General Ledger

Section: Chapter Questions

Problem 5PB: Following is the chart of accounts of Smith Financial Services: Smith completed the following...

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Question

On July 1, 2019, Pat Glenn established Half Moon Realty. Pat completed the following transactions during the month of July:
a. Opened a business bank account with a deposit of $25,000 from personal funds.
b. Purchased office supplies on account, $1,850.

c. Paid creditor on account, $1,200.
d. Earned sales commissions, receiving cash, $41,500.
e. Paid rent on office and equipment for the month, $3,600.
f. Withdrew cash for personal use, $4,000.
g. Paid automobile expenses (including rental charge) for the month, $3,050, and miscellaneous expenses, $1,600.
h. Paid office salaries, $5,000.
i. Determined that the cost of supplies on hand was $950; therefore, the cost of supplies used was $900.

Instructions
1. Indicate the effect of each transaction and the balances after each transaction, using
the following tabular headings:
Owner's Equity
Liabilities
Assets
Pat
Pat
Accounts
Glenn,
Glenn,
Sales
Salaries
Rent
Auto
Supplies
Misc.
Cash Supplies Payable Capital - Drawing Commissions Expense Expense Expense Expense Expense
2. Prepare an income statement for July, a statement of owner's equity for July, and a
balance sheet as of July 31

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