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Item7 0.15points Item 7 The following financial statements were prepared at the end of the month of May: TOPS IN TOPIARY - INCOME STATEMENT FOR

Item7

0.15points

Item 7

The following financial statements were prepared at the end of the month of May:

TOPS IN TOPIARY - INCOME STATEMENT FOR the month of May

Revenue $ 2,540
Expenses:
Rent Expense $ 500
Advertising Expense $ 500
Wages Expense $ 200 $ 1,200
Net Income $ 1,340

TOPS IN TOPIARY - STATEMENT OF OWNER'S EQUITY FOR the month of MAY

Owner's Equity at May 1 $ 0
plus: Investment 2,000
plus: Net Income 1,340
less: Withdrawals 0
Owner's Equity at May 31 $ 3,340

TOPS IN TOPIARY - BALANCE SHEET AS OF MAY 31

ASSETS LIABILITES AND OWNER'S EQUITY
Current Assets: Current Liabilities:
Cash $ 1,380 Accounts Payable $ 300
Accounts Receivable $ 1,500 Advertising Payable $ 500
Prepaid Rent $ 500 Advances from Customers $ 200
Prepaid Advertising $ 500
Supplies $ 100 $ 3,980
Equipment $ 360 Owner's Equity $ 3,340
Total Assets $ 4,340 Total Liabilities & OE $ 4,340

During June the following transactions occurred:

1) Paid the helper the $200 owed from works done in May (the amount owed is in Accounts Payable).

2) Completed the job for which the customer paid $200 in May. Tops in Topiary collected $1,000 in cash once finished.

3) Paid $500 for the rent of July.

4) At the end of June notices that there are no supplies left. Makes a note to buy some in July.

5) At the end of June notices that there are few flyers left (used for advertising) worth $100 and decides to order some for July. Before ordering, the printer (supplier of flyers) asks to be paid $500 of the amount owed for the flyers done in May. Tops in Topiary pays $500.

6) In June collected in cash $3,000 for 3 jobs are done for a total of $4,200, the rest is owed in account by the customers.

7) In June decided to start depreciating the equipment bought for $360 that is expected to last for 3 years.

8) In June 23rd Edward Scissorhands withdrew some cash for personal reasons ($3,000).

Prepare "T" Accounts in ACCRUAL Basis for the period ended on June 30th and then answer the question.

At the end of the accounting period (June 30th, T account after AJE), what is the balance of Accounts Receivables?

Multiple Choice

Less than $500

Between $2,000 and $3,000

Between $500 and $999

More than $3,000

Between $1,000 and $1,999

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