Rhaman Company had the following transactions in its first month of operations:
1. On incorporation, the company had issued 11,000 common shares in exchange for $10,000 cash and office furniture and equipment worth $1,000.
2. Additional equipment costing $4,000 was purchased for cash.
3. Supplies costing $500 were purchased for cash.
4. Inventory costing $5,000 was acquired on account. Later in the month, the company paid half of the amount owed. It will pay the remainder next month.
5. The entire inventory was sold to customers for $8,000. The company received half of this amount in cash and will receive the remainder next month.
6. By the end of the month, $400 of the supplies were used up.
7. The equipment was depreciated $100 for the month.
8. Operating expenses paid in cash during the month were $1,900.
9. Dividends of $200 were declared and paid during the month.
Required:
a. Calculate the following amounts for the month:
i. Sales revenue
ii. Cost of goods sold
iii. Total expenses other than cost of goods sold
iv. Net earnings or loss
b. Calculate the following amounts as at the end of the month:
i. Cash on hand
ii. Total assets other than cash
iii. Total liabilities
iv. Share capital
v. Retained earnings