Nikolas Benton launched a new business, Benton’s Maintenance Co. that began operations on June 1.
The following transactions were completed by the company during that first month.
June 1 N. Benton invested $41,000 cash in the company in exchange for common stock.
2 The company rented a furnished office and paid $2,200 cash for June’s rent.
4 The company purchased $1,860 of equipment on credit.
6 The company paid $780 cash for this month’s advertising of the opening of the business.
8 The company completed maintenance services for a customer and immediately collected $5,700 cash.
14 The company completed $2,400 of maintenance services for City Center on credit.
16 The company paid $810 cash for an assistant’s salary for the first half of the month.
20 The company received $2,400 cash payment for services completed for City Center on June 14.
24 The company completed $3,300 of maintenance services for Build-It Coop on credit.
25 The company received $3,300 cash payment from Build-It Coop for the work completed on
26 The company made payment of $1,860 cash for the equipment purchased on June 4.
27 The company purchased $80 of product advertising in this month’s (June) local newspaper on credit; cash payment is due July 1.
28 The company paid $810 cash for an assistant’s salary for the second half of this month.
29 The company paid $1,600 cash for dividends.
30 The company paid $250 cash for this month’s telephone bill.
30 The company paid $300 cash for this month’s utilities.
1. Arrange the following asset, liability, and equity titles in a table like Exhibit 1.9: Cash; Accounts Receivable; Equipment; Accounts Payable; Common Stock; Dividends; Revenues; and Expenses.
2. Show the effects of the transactions on the accounts of the accounting equation by recording increases and decreases in the appropriate columns. Do not determine new account balances after each transaction. Determine the final total for each account and verify that the equation is in balance.
3. Prepare a June income statement, a June statement of retained earnings, a June 30 balance sheet, and a June statement of cash flows.