The following amounts summarize the financial position of Mason Resources, Inc., on May 31, 2010:

During June 2010, Mason Resources completed these transactions:
a. The business received cash of $9,200 and issued common stock.
b. Performed services for a customer and received cash of $6,700.
c. Paid $4,500 on accounts payable.
d. Purchased supplies on account, $600.
e. Collected cash from a customer on account, $700.
f. Consulted on the design of a computer system and billed the customer for services rendered, $2,900.
g. Recorded the following business expenses for the month: (1) paid office rent––$1,100; (2) paid advertising––$1,000.
h. Declared and paid a cash dividend of $1,500.

Requirements
1. Analyze the effects of the preceding transactions on the accounting equation of Mason Resources, Inc.
2. Prepare the income statement of Mason Resources, Inc., for the month ended June 30, 2010. List expenses in decreasing order by amount.
3. Prepare the entity’s statement of retained earnings for the month ended June 30, 2010.
4. Prepare the balance sheet of Mason Resources, Inc., at June 30,2010.

Transcribed Image Text:

LiabilitiesStockholders' Equity Commorn Assets Accounts Retained +Earnings 2,400 Accounts Cash Receivable Supplies Land - Payable Stock Bal 1,150 1,350 11,900 7,600 4,400