Question
Susan Huang began the practice of law on October 1, 2023, with an initial investment of $15,400 in cash. She made no withdrawals during the
Susan Huang began the practice of law on October 1, 2023, with an initial investment of $15,400 in cash. She made no withdrawals during the month. After completing the first month of practice, the financial statements were prepared by Ryan Player, the secretary/bookkeeper Ms. Huang had hired. Ms. Huang almost burst out laughing when she saw them. She had completed a course in legal accounting in law school and knew the statements prepared by Player left much to be desired. Consequently, she asked you to revise the statements. The Player version is presented as follows:
Susan Huang, Lawyer | |||||||
Balance Sheet | |||||||
October 31, 2023 | |||||||
Assets | Liabilities and Equity | ||||||
Cash | $ | 3,750 | Susan Huang, capital | $ | 15,400 | ||
Furniture | 3,000 |
| |||||
Supplies expense | 500 | ||||||
Accounts payable | 1,250 | ||||||
Rent expense | 4,650 | ||||||
Supplies | 2,250 | ||||||
$ | 15,400 | $ | 15,400 | ||||
Susan Huang, Lawyer | ||||||
Income Statement | ||||||
For Month Ended October 31, 2023 | ||||||
Revenues: | ||||||
Legal revenue | $ | 20,500 | ||||
Accounts receivable | 2,900 | $ | 23,400 | |||
Expenses: | ||||||
Salaries expense | $ | 3,600 | ||||
Telephone expense | 350 | |||||
Law library | 16,150 | 20,100 | ||||
Profit | $ | 3,300 | ||||
Required: Prepare the corrected financial statements for Susan Huang.
1) Susan Huang, Lawyer
Income Statement
For month ended October 31,2023
2) Susan Huang, Lawyer
Statement of changes in Equity
for Month ended October 31,2023
3) Susan Huang, Lawyer
Balance sheet
October 31,2023
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