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Accounting (Text Only)

26th Edition
Carl Warren + 2 others
ISBN: 9781285743615

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BuyFindarrow_forward

Accounting (Text Only)

26th Edition
Carl Warren + 2 others
ISBN: 9781285743615
Textbook Problem
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Financial statements

Jose Loder established Bronco Consulting on August 1, 2016. The effect of each transaction and the balances after each transaction for August follow:

Chapter 1, Problem 1.3BPR, Financial statements Jose Loder established Bronco Consulting on August 1, 2016. The effect of each

Instructions

  1. 1. Prepare an income statement for the month ended August 31, 2016.
  2. 2. Prepare a statement of owner’s equity for the month ended August 31, 2016.
  3. 3. Prepare a balance sheet as of August 31, 2016.
  4. 4. (Optional) Prepare a statement of cash flows for the month ending August 31, 2016.

a)

To determine

Financial statements:

Financial statements refer to those statements, which are prepared by the Company according to particular formats in accounting to show its financial position.

Financial statements include the following statements:

Income statement:

Income statement is a financial statement that shows the net income or net loss by deducting the expenses from the revenues and vice versa.

Statement of owner's’ equity:

This statement reports the changes in the owners’ equity for a particular period of time.

Balance Sheet:

Balance Sheet summarizes the assets, the liabilities, and the Shareholder’s equity of a company at a given date.

Statement of cash flows:

This statement reports all the cash transactions which are responsible for inflow and outflow of cash, and result of these transactions is reported as ending balance of cash at the end of reported period.

To Prepare: The income statement of Company BC for the month ended August 31, 2016.

Explanation

Prepare the income statement of Company BC for the month ended August 31, 2016.

Company BC
Income Statement
For the month ended August 31, 2016
Particulars Amount ($) Amount ($)
Revenues
Fees Earned $125,000
Expenses
 ;&#x...

b)

To determine

To Prepare: The statement of Owner's equity for Company BC for the month ended August 31, 2016.

c)

To determine

To Prepare: The balance sheet of Company BC for the month ended August 31, 2016.

d)

To determine

To Prepare: The statement of cash flows for Company BC for the month ended August 31, 2016.

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