Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

78 chapter 1 > Continung Problem Problem P1-54 is the first problem in a sequence that begins an accounting cyle. The cyele is continued in

image text in transcribed
78 chapter 1 > Continung Problem Problem P1-54 is the first problem in a sequence that begins an accounting cyle. The cyele is continued in Chapter 2 and completed in Chapter 5. 3. Ending Capital $18,400 P1-54 Using the accounting equation for transaction analysis, preparing financi statements, and calculating return on assets (ROA) Davis Consulting began operations and completed the followving transactions during December, 2014 Dec. 2 Owner contributed $18,000 cash in exchange for capital. 2 Paid monthly office rent, $550 3 Paid cash for a computer, $1,800. This equipment is expected to remain in service for five years 4 Purchased office furniture on account, $4,200. The furniture should last for ive years 5 Purchased office supplies on account, $900 9 Performed consulting service for a dient on account, $1,500 12 Paid utilities expenses, $250. 18 Performed service for a client and received cash of $1,100. 21 Received $1,400 in advance for client service to be performed over the next 30 days. (This increases the Unearned Revenue account which is a liability. This account will be explained in more detail in Chapter 2.) Hired an administrative assistant to be paid $2.055 on the 20th day of each month. The secretary begins work immediately 21 26 Paid $400 on account. 28 Collected $300 on account 30 Davis withdrew $1,400 Requirements 1. Analyze the effects of Davis Consulting's transactions on the accounting equation. Use the format of Exhibit 1-4, and include these headings: Cash Accounts Receivable, Office Supplies; Equipment; Furniture: Accounts Payable: Unearned Revenue; Davis, Capital; Davis, Withdrawals Service Revenue; Rent Expense; and Uilities Expense. 2. Prepare the income statement of Davis Consulting for the month ended December 31, 2014. 3. Prepare the statement of owner's equity for the month ended December 31, 2014. 4. Prepare the balance sheet as of December 31, 2014. 5. Calculate the return on assets for Davis Consulting

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditing Principles

Authors: Nformi Eugene Tawe

1st Edition

3330651032, 978-3330651036

More Books

Students also viewed these Accounting questions