Exercise 4-8 (Algo) Record transactions and calculate financial statement amounts LO 4-2, 4-6, 4-7 The following are the transactions relating to the formation of Gray Mowing Servces incorporated and its first morth of operabions o. The firm was organized and the initial stockholders invested cash of $780. b. The company borrowed $1,170 from a relative of one of the intual stockholders; a shortferm note was signed. c. Two zero-turn lawn mowers costing $624 each and a professional trimmer costing $169 were purchased for cash. The onginas ins price of each mower was $793, but a discount was recelved because the seller was having a sale: d. Gasoline, oll, and several packages of trash bags were purchased for cash of $117 e. Advertising flyers announcing the formation of the business and a newspaper ad were purchased. The cost of these tiens. 5222 . will be paid in 30 days. f. During the first two weeks of operations, 47 lawns were mowed. The total revenue for this work was $917, 5605 was coliectied in cash, and the balance will be recelved within 30 days: 9. Employees were paid $546 for their work during the first two weeks. h. Additional gasoline, oll, and trash bags costung $143 were purchased for cash. I. In the last two weeks of the first month, revenues totaled $1196, of which $488 was collected. J. Employee wages for the last two weeks totaled $663; these wili be paid during the first week of the next month. k. It was determined that at the end of the month the cost of the gasoline, oll, and trash bags still on hand was 539. 1. Customers pald a total of $195 due from mowing services provided during the first two weeks. The revenue for these services was recognized in transaction f. k. It was determined that at the end of the month the cost of the gasoline, oll, and trash bags still on hand was 539 . I. Customers paid a total of $195 due from mowing services provided duning the first two weeks. The revenue for these services was recognized in transactiont. Required: a. Pecord each tansaction in the appropriate columns. Indicate the financial statement effect. b. Calculate the total assets, labilities, and owners' equity at the end of the month and calculate the amount of net income for me month. c. 1. After recording transactions a through I, prepare an income statement for Gray Mowing Seivices incorporated for the month presented. 2. After recording transactions a through I. prepare a balance sheet at the end of the month. Complete this question by entering your answers in the tabs below. Calculate the total assets, liabilities, and owners' equity at the end of the month and calculate the amount of net income for the month. presented. 2. After recording transactions a through I. prepare a balance sheet at the end of the month. Complete this question by entering your answers in the tabs below. After recording transactions a through I, prepare an income statement for Gray Mowing Services incorporated for the manth presented. Note: Enter decreases with a minus sign to indicate a negative income statement effect. month
