Kiya Towodros is a proprietorship owned and operated By MM Towodros on July 1.2014. MM Towodros has the following Assets and Liabilities: Cash birr 1,000; Account receivable birr 3,200: supplies birr 850; land birr10, 000; Account payable birr 1,530. Office space and office Equipment are currently being rented, pending the construction of an office complex on the land purchases last year. Business transactions in July are summarized as follows;

1. Received cash from clients for services, birr 3,928
2. Paid creditor on account. birr 1,055
3. Received cash from Kiya as an additional investment, birr 3,700
4. Paid office rent for the month birr 1,200
5. Charged clients for legal services on account, birr 2,025
6. Purchased office supplies on account, birr 245
7. Received cash from clients on account birr3,000
8. Received an invoice for paralegal services from legal Aid Inc. for July ( to be paid on August 10), birr 1,635 Paid the following; wage expense, birr 850; answering service expanse, birr 250 : utilities Expense, birr 325; and miscellaneous expense,birr75 Determined that the cost of office supplies on hand was birr 980 :therefore, the cost of supplies used during the month was birr 115 Kiya Withdrew birr 1,000 in cash from the business for personal use.

Instruction

1. Determine the amount of owner’s equity (MM Towodros Capital ) as of July 1,2014
2. Summarizes the transaction in tabular form.
3. Prepare income statement, statement of Owners equity, Balance sheet and Statement of cash flow.