Question

Handyman Services was founded on January 1 and entered into the following transactions during January:
1. Issued common stock of $30,000 in exchange for cash.
2. Purchased an old warehouse for $50,000 by issuing notes payable.
3. Purchased a truck for $15,000 cash.
4. Purchased shop supplies for $5,000 on account.
5. Provided services of $15,325, receiving $12,200 in cash.
6. Paid $1,000 for local advertising for January.
7. Received payment of $3,125 from customers in #5.
8. Paid $4,000 on open account from #4.
9. Paid dividends of $1,000 to stockholders.
10. Paid employee salaries of S4.000 for January.
11. Billed customers $3,500 for services provided during January.
12. Paid $100 interest on notes payable.
Required
a. Show the effects of each transaction on the accounting equation by preparing a tabular analysis using the following column headings: Cash, Accounts Receivable, Supplies, Property and Equipment, Accounts Payable, Notes Payable, Common Stock, Retained Earnings.
b. Calculate Handyman's net income for the month of January.


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  • CreatedJuly 16, 2015
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