Question: The following cash transactions took place during August the first

The following cash transactions took place during August, the first month of business for Comfy Cushions Cleaning, a corporation:
a. Justin Snyder started the company by contributing $30,000 cash and received common stock in exchange.
b. The company earned and received $10,000 cash in service revenue.
c. The company paid employees $3,000 cash.
d. Miscellaneous expenses paid amounted to $725 cash.
e. The company declared and paid cash dividends of $975.
f. On August 31, the company borrowed $13,300 from the local bank, to be repaid at the end of December.

1. Show how each transaction affects the accounting equation.
2. Prepare the income statement, statement of changes in shareholder’s equity, and the statement of cash flows for the month ended August 31 and the balance sheet at August 31.

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  • CreatedSeptember 01, 2014
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