An analysis of the transactions made by Peat Deloitte & Co., a certified public accounting firm, for
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Question:
An analysis of the transactions made by Peat Deloitte & Co., a certified public accounting firm, for the month of August is shown as follows. The expenses were $560 for rent, $4,800 for salaries and wages, and $400 for utilities.
| Cash | + | Accounts Receivable | + | Supplies | + | Equipment | = | Accounts Payable | + | Owner’s Capital | – | Owner’s Drawings | + | Revenues | – | Expenses | |
| 1. | +$15,000 | +$15,000 | |||||||||||||||
| 2. | –2,000 | +$5,000 | +$3,000 | ||||||||||||||
| 3. | –750 | +$750 | |||||||||||||||
| 4. | +4,000 | +$4,500 | +$8,500 | ||||||||||||||
| 5. | –1,500 | –1,500 | |||||||||||||||
| 6. | –2,000 | –$2,000 | |||||||||||||||
| 7. | –560 | –$560 | |||||||||||||||
| 8. | +450 | –450 | |||||||||||||||
| 9. | –4,800 | –4,800 | |||||||||||||||
| 10. | +400 | –400 | |||||||||||||||
Instructions
- Describe each transaction that occurred for the month.
- Determine how much owner’s equity increased for the month.
- Compute the amount of net income for the month.
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