Don Griffin worked as an accountant at a local accounting firm for five years after graduating from
Don Griffin worked as an accountant at a local accounting firm for five years after graduating from university. Recently, he opened his own accounting practice, which he operates as a corporation. The name of the new entity is Griffin and Associates, Inc. Don experienced the following events during the first month of operations. Some of the events were personal and did not affect the accounting practice. Others were business transactions and should be accounted for by the business.
Apr 3 Received $20,000 cash proceeds from refinancing his house.
5 $90,000 of shares in the business were sold to Don Griffin. The cash proceed? Were deposited in a new business bank account titled Griffin and Associates, Inc.
7 Paid $600 cash for office supplies for the new accounting practice.
9 Purchased $4,000 of office furniture for the accounting practice and agreed to pay the vendor within three months.
10 Don sold 1,200 Mercedes shares, which he had owned for several years, received $22,000 cash. The cash from the sale of shares was deposited in his personal bank account.
14 A representative of a large company telephoned Don and told him of the company intention to hire Griffin and Associates, Inc. as its accountants.
20 Finished accounting work for a client and sent the client a bill for $3,900. The client is expected to pay within two weeks.
27 Paid office rent, $1,200.
30 Paid $500 of dividends to Griffin and Associates, Inc. shareholders.
1. Enter each transaction in the expanded accounting equation of Griffin and Associates, Inc. as needed, calculating new balances after each transaction.
2. Determine the following items:
a. Total assets
b. Total liabilities
c. Total shareholders’ equity
d. Net income or net loss for April
Step by Step Answer: