BuyFindarrow_forward

College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756

Solutions

Chapter
Section
BuyFindarrow_forward

College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756
Textbook Problem

MASTERY PROBLEM

Lisa Vozniak started her own business, We Do Windows. She offers interior and exterior window cleaning for local area residents. Lisa rents a garage to store her tools and cleaning supplies and has a part-time assistant to answer the phone and handle third-story work. (Lisa is afraid of heights.) The transactions for the month of July are as follows:

(a) Lisa invested cash by making a deposit in a bank account for the business, $8,000.

(b) Paid rent for July, $150.

(c) Purchased a used van for cash, $5,000.

(d) Purchased tools on account from Clean Tools, $600.

(e) Purchased cleaning supplies that cost $300. Paid $200 cash and will pay the balance next month, $100.

(f) Paid part-time assistant (wages) for first half of month, $100.

(g) Paid for advertising, $75.

(h) Paid two-year premium for liability insurance on van, $480.

(i) Received cash from clients for services performed, $800.

(j) Performed cleaning services for clients on account, $500.

(k) Paid phone bill, $40.

(l) Received cash from clients for window cleaning performed on account in transaction (j), $200.

(m) Paid part-time assistant (wages) for last half of month, $150.

(n) Made partial payment on tools purchased in transaction (d), $200.

(o) Earned additional revenues amounting to $800: $600 in cash and $200 on account.

(p) Vozniak withdrew cash at the end of the month for personal expenses, $100.

REQUIRED

1. Enter the above transactions in an accounting equation similar to the one illustrated below.

images

2. After transaction (p), compute the balance of each account.

3. Prepare an income statement for We Do Windows for the month of July 20--.

4. Prepare a statement of owner’s equity for We Do Windows for the month of July 20--.

5. Prepare a balance sheet for We Do Windows as of July 31, 20--.

1.

To determine

Enter the transactions in an accounting equation.

Explanation

Accounting equation: Accounting equation is an accounting tool expressed in the form of equation, by creating a relation between resources or assets of a business and claims on the resources by the creditors, and the owners...

2.

To determine

Compute the balance of each account after transaction (p).

3.

To determine

Prepare an income statement for the month of July.

4.

To determine

Prepare a statement of owners’ equity for the month of July.

5.

To determine

Prepare a balance sheet for Company W as of July 31.

Still sussing out bartleby?

Check out a sample textbook solution.

See a sample solution

The Solution to Your Study Problems

Bartleby provides explanations to thousands of textbook problems written by our experts, many with advanced degrees!

Get Started

Additional Business Solutions

Find more solutions based on key concepts

Show solutions add

Are employee benefits really necessary? Why?

Foundations of Business (MindTap Course List)

How do unions affect the natural rate of unemployment?

Principles of Macroeconomics (MindTap Course List)

Briefly explain what is meant by the term efficiency continuum.

Fundamentals of Financial Management, Concise Edition (MindTap Course List)

COST OF COMMON EQUITY WITH AND WITHOUT FLOTATION The Evanec Companys next expected dividend, D1 is 3.18; its gr...

Fundamentals of Financial Management, Concise Edition (with Thomson ONE - Business School Edition, 1 term (6 months) Printed Access Card) (MindTap Course List)