Continuing Problem (Chapter - 1)

The following problem will continue from one chapter to the next, carrying the balances forward from month to month. Each chapter will focus on the learning experience of the chapter and add additional information as the business grows. Excel templates for the Continuing Problem are available in MyLab Accounting.

Assignment

1. Set up an expanded accounting equation spreadsheet using the following accounts:

Assets Liabilities owner's equity

Cash Accounts Payable T. Freedman, Capital

Supplies T. Freedman, Withdrawals

Computer Shop Service Revenue

Equipment Expenses (notate type)

Office Equipment

2. Analyze and record each transaction in the expanded accounting equation.

3. Prepare the financial statements for Precision Computer Centre for the period ending May 31.

Tony Freedman decided to begin his own computer service business on May 2, 2022. he named the business the Precision Computer Centre. During the month of May, Tony conducted the following business transactions:

A. Invested $4500 of his savings into the business.

B. Paid $1200 for a computer from Multi Systems, Inc.

C. Paid $600 for the office equipment from office furniture, Inc.

D. set up a new account with Staples and purchased $250 in the office Supplies on credit.

E. Paid my rent $400.

F. Repaired a system for the customer , collected $250.

G. Collected $200 for system upgrade labour charge from a customer.

H. Electric Bill due at May 31 but unpaid, $85

I. Received $1200 for services performed on Taylor Golf computers.

J. Tony withdrew $100 to take his wife Carol out in celebration of the opening new business. Note: The business is too small to worry about GST (or HST), and PST is not applicable either.