Question
Problem 3 Recording Transaction in the Expanded Accounting Equation Cora Crouse began Coras Cleaning Service on April 1, 20XX as a proprietorship. The following transactions
Problem 3 Recording Transaction in the Expanded Accounting Equation
Cora Crouse began Coras Cleaning Service on April 1, 20XX as a proprietorship. The following transactions occurred during the first month of operations.
April 1 | Cora invested $10,000 of equipment and $15,000 cash in the business. |
April 1 | Paid the office rent for April in cash in the amount of $1,000. |
April 4 | Purchased $5,000 of equipment, paying $2,500, with the balance due in 20 days. |
April 10 | Billed a client for $4,000 for services rendered during April. |
April 15 | Purchased on account a $200 ad in the local newspaper for April. |
April 20 | Received cash (full payment) from the client billed April 10. |
April 24 April 28 April 30 | Paid for the equipment that was purchased on April 4. Paid salaries to employees a totaling $2,000. Cora withdrew $3,000 cash from the business. |
Required:
Complete the following table to record the transactions as they affect the accounting equation. Show the effects on the accounting equation by placing a + sign if the adjustment increases or a - sign if the adjustment decreases the accounting equation element. Compute totals for each account and compute final totals for the accounting equation.
-----------------Assets------------------ = Liabilities + --------Owners Equity-------------
Date | Cash | Accounts Receivable | Equipment | Accounts Payable | Crouse, Capital | Revenue | Expense |
4/1 |
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4/1 |
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4/4 |
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4/10 |
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4/15 |
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4/20 |
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4/24 |
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4/28 |
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4/30 |
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Totals |
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Total Assets: $__________ Total Liabilities and Equity: $__________
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