Jessi Paulis started a consulting firm, Paulis Consulting, on May 1, 2014. The following transactions occurred during the month of May.

May 1 Paulis invested $8,000 cash in the business in exchange for stock.

2 Paid $800 for office rent for the month.

3 Purchased $500 of supplies on account.

5 Paid $50 to advertise in the County News.

9 Received $3,000 cash for services provided.

12 Declared and paid a $700 cash dividend.

15 Performed $3,300 of services on account.

17 Paid $2,100 for employee salaries.

20 Paid for the supplies purchased on account on May 3.

23 Received a cash payment of $2,000 for services provided on account on May 15.

26 Borrowed $5,000 from the bank on a note payable.

29 Purchased office equipment for $2,300 on account.

30 Paid $150 for utilities.

Instructions

(a) Show the effects of the previous transactions on the accounting equation using the following format.

Problems: SetB 43 Prepare income statement, retained earnings statement, and balance sheet.

(LO 8)

(a) Net income $2,500 Total assets $41,000

(b) Net income $3,200 Analyze transactions and prepare financial statements.

(LO 6, 7, 8)

(a) Total assets $17,800 Div.

Assets = Liabilities + Stockholders’ Equity Accounts : ; _ Notes Accounts , Common Retained Earnings aoe Receivable i SUES lo Eo Payable Payable Stock Rew = bey =

Include margin explanations for any changes in the Retained Earnings account in your analysis.

(b) Prepare an income statement for the month of May.

(c) Prepare a balance sheet at May 31, 2014.