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College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756

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BuyFindarrow_forward

College Accounting, Chapters 1-27

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

Joe Fisher operates Fisher Consulting. A partial work sheet for August 20-- is provided below. Fisher made no additional investments during the month. Prepare an income statement, statement of owner’s equity, and balance sheet.

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To determine

Prepare the following statements:

  • Income statement.
  • Statement of owner’s equity, and
  • Balance sheet.
Explanation

Income statement: The financial statement which reports revenues and expenses from business operations and the result of those operations as net income or net loss for a particular time period is referred to as income statement.

Prepare an income statement of F Consulting for the month ended August 31, 20---:

F Consulting
Income Statement
For Month Ended August 31, 20--
ParticularsAmount ($)Amount ($)
Revenues:
    Professional fees5,000
Expenses:
    Wages expense1,000
    Rent expense700
    Depreciation expense100
   Total Expenses1,800
Net Income$3,200

Table (1)

Statement of owners’ equity: This statement reports the beginning owner’s equity and all the changes, which led to ending owners’ equity. Additional capital, net income from income statement is added to and a drawing is deducted from beginning owner’s equity to arrive at the result, ending owner’s equity.

Prepare a statement of owner’s equity of F Consulting for the month ended August 31, 20---:

F Consulting
Statement of Owner’s Equity
For Month Ended August 31, 20--
ParticularsAmount ($)Amount ($)
JF, Capital, August 1, 20--3,000
Add: Net...

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