The following transactions of Larson Services Inc. occurred during August 2019, its first month of operations. Aug.

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Question:

The following transactions of Larson Services Inc. occurred during August 2019, its first month of operations.

Aug. 1 Issued common stock for $3,000 cash

1 Borrowed $10,000 cash from the bank

1 Paid $8,000 cash for a used truck

4 Paid $600 for a one?year truck insurance policy effective August 1 (record as an asset)

5 Collected $2,000 fees from a client for work to be performed at a later date

7 Billed a client $5,000 for services performed today

9 Paid $250 for supplies purchased and used today

12 Purchased $500 of supplies on credit (record as an asset)

15 Collected $1,000 of the amount billed August 7

16 Paid $200 for advertising in The News during the first two weeks of August

20 Paid $250 of the amount owing for supplies purchased on August 12

25 Paid the following expenses: rent for August, $350; salaries, $2,150; telephone, $50; truck operating, $250

28 Called clients about payment of the balances owing from August 7

29 Billed a client $6,000 for services performed today, including $1,500 related to cash received August 5

31 Transferred $50 of August's prepaid expenses to insurance expense

31 Counted $100 of supplies still on hand (recorded the amount used as an expense).

Required:

1. Record the above transactions on a transactions worksheet and calculate the total of each column at the end of August. Use the following headings on your worksheet.

2. Prepare an income statement and statement of changes in equity for the month ended August 31, 2019, and a balance sheet at August 31, 2019. Identify the revenue earned as Fees. Record the expenses in alphabetical order.