Neveranerror Inc. was organized on June 2 by a group of accountants to provide accounting and tax services to small businesses. The following transactions occurred during the first month of business: June 2: Received contributions of $10,000 from each of the three owners of the business in exchange for shares of stock. June 5: June 8: June 15: Purchased a computer system for $12,000. The agreement with the vendor requires a down payment of $2,500 with the balance due in 60 days. Signed a two-year promissory note at the bank and received cash of $20,000. Billed $12,350 to clients for the first half of June. Clients are billed twice a month for services performed during the month, and the bills are payable within ten days. June 17: Paid a $900 bill from the local newspaper for advertising for the month of June. June 23: June 28: June 29: Received the amounts billed to clients for services performed during the first half of the month. Received and paid gas, electric, and water bills. The total amount is $2,700. Received the landlord's bill for $2,200 for rent on the office space that Neveranerror leases. The bill is payable by the 10th of the following month. June 30: Paid salaries and wages for June. The total amount is $5,670. June 30: Billed $18,400 to clients for the second half of June. June 30: Declared and paid dividends in the amount of $6,000.
Neveranerror Inc. was organized on June 2 by a group of accountants to provide accounting and tax services to small businesses. The following transactions occurred during the first month of business: June 2: Received contributions of $10,000 from each of the three owners of the business in exchange for shares of stock. June 5: June 8: June 15: Purchased a computer system for $12,000. The agreement with the vendor requires a down payment of $2,500 with the balance due in 60 days. Signed a two-year promissory note at the bank and received cash of $20,000. Billed $12,350 to clients for the first half of June. Clients are billed twice a month for services performed during the month, and the bills are payable within ten days. June 17: Paid a $900 bill from the local newspaper for advertising for the month of June. June 23: June 28: June 29: Received the amounts billed to clients for services performed during the first half of the month. Received and paid gas, electric, and water bills. The total amount is $2,700. Received the landlord's bill for $2,200 for rent on the office space that Neveranerror leases. The bill is payable by the 10th of the following month. June 30: Paid salaries and wages for June. The total amount is $5,670. June 30: Billed $18,400 to clients for the second half of June. June 30: Declared and paid dividends in the amount of $6,000.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Neveranerror Inc. was organized on June 2 by a group of accountants to provide accounting and tax services to small businesses. The following transactions occurred during the first month of business:
June 2:
Received contributions of $10,000 from each of the three owners of the business in exchange for shares
of stock.
June 5:
June 8:
June 15:
June 17:
June 23:
June 28:
June 29:
Purchased a computer system for $12,000. The agreement with the vendor requires a down payment of
$2,500 with the balance due in 60 days.
Signed a two-year promissory note at the bank and received cash of $20,000.
Billed $12,350 to clients for the first half of June. Clients are billed twice a month for services
performed during the month, and the bills are payable within ten days.
Paid a $900 bill from the local newspaper for advertising for the month of June.
Received the amounts billed to clients for services performed during the first half of the month.
Received and paid gas, electric, and water bills. The total amount is $2,700.
Received the landlord's bill for $2,200 for rent on the office space that Neveranerror leases. The bill is
payable by the 10th of the following month.
June 30:
Paid salaries and wages for June. The total amount is $5,670.
June 30: Billed $18,400 to clients for the second half of June.
June 30: Declared and paid dividends in the amount of $6,000.
Transcribed Image Text:June 2
June 5
Bal.
June 8
Bal.
June 15
Bal.
June 17
Bal.
June 23
Bal.
June 28
Bal.
June 29
Bal.
June 30-Wages
Bal.
June 30-Billed
30,000 ✓
-2,500
27,500 ✓
20,000 ✓
47,500 ✓
0 ✓
47,500 ✓
-900 ✓
$
46,600 ✓
12,350 ✓
58,950
$
-2,700 ✔
56,250 ✓
圍
0 ✓
$
✓
56,250
-5,670 ✓
50,580 ✓
0 ✓
Receivable
0
0 ✓
0 ✓
0 ✓
0
12,350 ✓
12,350
0
✓
12,350 ✓
-12,350 ✓
0 ✓
0 ✓
0 ✓
-2,200 X
-2,200 X
0 ✓
-2,200 X
18,400 ✔
0 ✓
12,000 ✓
12,000
0
12,000
0
0
$
12,000 ✓
12,000
✓
✓
0 ✓
12,000
$
12,000 ✓
✓
0 ✓
12,000
0 ✓
12,000
$
✓
0 ✓
✓
0 ✓
0
0
0
0
0
0
0
0
0 ✓
✓
✓
0 ✓
0
✓
$
0 ✓
0
2,200 ✓
2,200 ✓
2,200 ✓
0 ✓
Payable
0
9,500
9,500
0
✓
9,500 ✔
✓
0 ✓
9,500 ✓
0 ✓
9,500 ✓
0 ✓
9,500 ✓
0 ✓
9,500 ✓
9,500
0 ✓
0
9,500 ✓
0 ✓
0
0
0
20,000 ✓
$
20,000 ✓
0
$
20,000 ✓
✓
0
$
20,000 ✓
0
20,000
0
20,000
0
0
20,000 ✓
20,000
✓
0
$
✓
✓
30,000
0
30,000
0
0
30,000 ✓
✓
0
$
30,000 ✓
30,000
✓
✓
30,000
✓
D
0 ✓
30,000
✓
$
0 ✓
0 ✓
30,000 ✓
✓
0
30,000 ✓
0 ✓
$
Earnings
0 X
0
0
0
12,350
>
X
0 X
>
12,350 X
0
-900 ✓
11,450 X
✓
11,450 X
-2,700 ✓
10,800 X
0 X
650 X
-5,670 ✔
-5,020 X
18,400 ✓
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