Gabi Gram started The Gram Co , a new business that began operations on May 1 The Gram Co completed the following transactions during its first month of operations May 1 G Gram invested $41,000 cash in the company in exchange for its common stock 1 The company rented a furnished office and paid $2,500 cash for Mays rent 3 The company purchased $1,880 of office equipment on credit 5 The company paid $750 cash for this months cleaning services 8 The company provided consulting services for a client and immediately collected $5,100 cash 12 The company provided $2,600 of consulting services for a client on credit 15 The company paid $730 cash for an assistants salary for the first half of this month 20 The company received $2,600 cash payment for the services provided on May 12 22 The company provided $3,500 of consulting services on credit 25 The company received $3,500 cash payment for the services provided on May 22 26 The company paid $1,880 cash for the office equipment purchased on May 3 27 The company purchased $75 of office equipment on credit 28 The company paid $730 cash for an assistants salary for the second half of this month 30 The company paid $400 cash for this months telephone bill 30 The company paid $260 cash for this months utilities 31 The company paid $1,900 cash in dividends to the owner (sole shareholder) 2 a Prepare income statement for May 2 b Prepare statement of retained earnings for May 2 c Prepare balance sheet for May 31 3 Prepare statement of cash flows for May THE GRAM CO Income Statement For Month Ended May 31 Revenues Cash $ Accounts receivable 5,100 2,600 3,500 Accounts receivable Expenses Rent expense $ 2,500 750 Cleaning expense Salaries expense 1,460 Telephone expense 400 Utilities expense 260 Total expenses 5,370 5,830 Net income $ THE GRAM CO Statement of Retained Earnings For Month Ended May 31 Retained earnings, May 1 $ 0 Add Net income 5,830 5,830 Less Dividends 1,900 3,930 Retained earnings, May 31 $ THE GRAM CO Balance Sheet May 31 Assets Liabilities Equity 0 Total equity 0 Total liabilities and equity Total assets $ $ 0 Cash flows from operating activities $ 0 Cash flows from investing activities 0 Cash flows from financing activities $ Oo oo Cash balance, May 1 Cash balance May 31 $

The Answer is in the image, click to view ...

Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Jul 18, 2024

Gabi Gram started The Gram Co., a new business that began operations on May 1. The Gram Co. completed the following transactions during its first

Gabi Gram started The Gram Co., a new business that began operations on May 1. The Gram Co. completed the following transactions during its first month of operations.

May	1	G. Gram invested $41,000 cash in the company in exchange for its common stock.
	1	The company rented a furnished office and paid $2,500 cash for Mays rent.
	3	The company purchased $1,880 of office equipment on credit.
	5	The company paid $750 cash for this months cleaning services.
	8	The company provided consulting services for a client and immediately collected $5,100 cash.
	12	The company provided $2,600 of consulting services for a client on credit.
	15	The company paid $730 cash for an assistants salary for the first half of this month.
	20	The company received $2,600 cash payment for the services provided on May 12.
	22	The company provided $3,500 of consulting services on credit.
	25	The company received $3,500 cash payment for the services provided on May 22.
	26	The company paid $1,880 cash for the office equipment purchased on May 3.
	27	The company purchased $75 of office equipment on credit.
	28	The company paid $730 cash for an assistants salary for the second half of this month.
	30	The company paid $400 cash for this months telephone bill.
	30	The company paid $260 cash for this months utilities.
	31	The company paid $1,900 cash in dividends to the owner (sole shareholder).

2-a. Prepare income statement for May. 2-b. Prepare statement of retained earnings for May. 2-c. Prepare balance sheet for May 31. 3. Prepare statement of cash flows for May.

image text in transcribed

THE GRAM CO. Income Statement For Month Ended May 31 Revenues: Cash $ Accounts receivable 5,100 2,600 3,500 Accounts receivable Expenses Rent expense $ 2,500 750 Cleaning expense Salaries expense 1,460 Telephone expense 400 Utilities expense 260 Total expenses 5,370 5,830 Net income $ THE GRAM CO. Statement of Retained Earnings For Month Ended May 31 Retained earnings, May 1 $ 0 Add: Net income 5,830 5,830 Less: Dividends 1,900 3,930 Retained earnings, May 31 $ THE GRAM CO. Balance Sheet May 31 Assets Liabilities Equity 0 Total equity 0 Total liabilities and equity Total assets $ $ 0 Cash flows from operating activities $ 0 Cash flows from investing activities 0 Cash flows from financing activities $ Oo oo Cash balance, May 1 Cash balance. May 31 $