Financial balances for Tom's business on 30 June 20X3 are given below: ASSETS Cash Account Receivable...

 

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Financial balances for Tom's business on 30 June 20X3 are given below: ASSETS Cash Account Receivable Inventory Equipment Total Assets LIABILITIES 20,000 Account Payable 6,063 33,125 Loan OWNERS EQUITY 49,688 Capital 2,500 Total Liabilities 105,313 & Owners Equity 21,875 77,375 105,313 During the month of July 20X3, the following transactions occurred: 1. Paid $4,720 on account payable. 2. Collected $14,800 of the account receivable. 3. Purchased equipment for $12,400, paid $3,000 in cash and signed a loan agreement for the balance. 4. Billed customers for services completed, $11,640. 5. Purchased supplies on credit $680. 6. Paid cash for advertising expense $1,200; rent $4,000 and wages $4,100. 7. Collected $13,500 of the accounts receivables. 8. The owner withdrew $1,200 for personal use. 9. Received $200 electricity bill to be paid in August 20X3. REQUIRED: (a) Record each business transaction, using the accounting equation format (5 marks) (b) Prepare a Statement of Financial Performance (2 marks) (c) Prepare a Statement of Owners Equity (1 mark) (d) Prepare a Statement of Financial Position (3 marks) (e) Prepare a Statement of Cash Flows. (4 marks) Financial balances for Tom's business on 30 June 20X3 are given below: ASSETS Cash Account Receivable Inventory Equipment Total Assets LIABILITIES 20,000 Account Payable 6,063 33,125 Loan OWNERS EQUITY 49,688 Capital 2,500 Total Liabilities 105,313 & Owners Equity 21,875 77,375 105,313 During the month of July 20X3, the following transactions occurred: 1. Paid $4,720 on account payable. 2. Collected $14,800 of the account receivable. 3. Purchased equipment for $12,400, paid $3,000 in cash and signed a loan agreement for the balance. 4. Billed customers for services completed, $11,640. 5. Purchased supplies on credit $680. 6. Paid cash for advertising expense $1,200; rent $4,000 and wages $4,100. 7. Collected $13,500 of the accounts receivables. 8. The owner withdrew $1,200 for personal use. 9. Received $200 electricity bill to be paid in August 20X3. REQUIRED: (a) Record each business transaction, using the accounting equation format (5 marks) (b) Prepare a Statement of Financial Performance (2 marks) (c) Prepare a Statement of Owners Equity (1 mark) (d) Prepare a Statement of Financial Position (3 marks) (e) Prepare a Statement of Cash Flows. (4 marks)

Answer rating: 100% (QA)

a Recording Business Transactions 1 Paid 4720 on account payable Decrease in Cash 4720 Decrease in Account Payable 4720 2 Collected 14800 of the accou... View the full answer