Jasmine started a haircutting business called Expressions. The following events occurred in the first month:

A. On August 1, Worthy invested $3,000 in cash and $15,000 in equipment with Expressions in exchange for common stock.

B. On August 2, Expressions paid $600 in cash for the store's furniture.

A. On August 3, Expressions paid $500 in cash to rent a space in a mall for the month of August.

D. On August 4, purchased equipment for the shop for $1,200 on credit (using a long-term promissory note)

E. On August 5, Expressions opened for business. Cash received from haircut services in the first week of business was $825.

F. Provided $100 haircut service on account on August 15th.

G. On August 17, received a check for $100 for service rendered on the account earlier.

H. paid an assistant $125 on August 17.

I. Cash received from services rendered in the second half of August was $930.

J. On August 31, J. paid an instalment of $400 in principal on the promissory note entered on August 4.

k. He paid $900 cash in dividends to Worthy (the sole shareholder) on August 31.

Necessary:

1. Open the required T accounts

2. Prepare a Trial balance by August 31st

3. Prepare an income statement for the month of August

4. Prepare a balance sheet as of August 31st

Answer rating: 100% (QA)

TAccounts Cash Date Account Debit Credit Aug 1 Worthy 3000 Aug 2 Furniture 600 Aug 3 Mall Rent 500 A... View the full answer