Tim Lumber buys $350,000 more inventory, pays $150,000 cash now, balance due to suppliers next month Pays cash in Mo 11 against Accts Payable starting balance owed from Mo 10 Accts Payable Tim Lumber sells $475,000 of inventory to customers for $725,000 net $450,000 were cash sales, balance of sales on credit due from customers in 30 days in next months accounting period $140,000 cash is collected in the current Month 11 period on Accts Receivable carried over from Mo 10 Building monthly rent paid cash in current period is $10,000 monthly going forward Wage expense $45,000, $30,000 cash, balance paid next period Mo 10 Wage Payable is paid cash now $50,000 is repaid on the Bank loan Mo loan interest expense $1,000, paid cash in current period Tim Lumber buys extra $200,000 inventory, pays $50,000 cash, balance on Supplier credit, due in Mo 12 Office supplies and utilities expense together totaled $30,000, paid cash in the current period Depreciation expense is $750 per month ($72,000 div by 8 $9,000 annual div by 12 $750 mo ) Amortized monthly insurance policies expense of $300 recorded in the current period Another $75,000 is received in Mo 11 from accts rec owed by customers who bought on credit in month 11 Dividends $10,000 paid cash to Owner in Mo 11 Month 11 Retained Earns Mo 11 N Inc $10,000 Div Tim Lumber owes $43,950 income tax on Mo 11 pre tax profits, pays period 12 Tim Lumber pays Mo 10 Tax payable PREPARE THE 11 PERIOD INCOME STATEMENT ENDING BALANCE SHEET CASH 282 7 WAGES PAYABLE 8 ACCT RECEIVABLE 155 SUPPLIER PAYABLE 220 INVENTORY 443 LOC BANK LOAN 135 Prepaid Curr Asset 6 TAX Oth PAYABLE 30 TOT CURR ASSETS 881 3 CURR LIABILITIES 393 LT ASSETS Office Eq 64 5 LONG TERM DEBT TOTAL LIABILITIES 393 TOTAL ASSETS 945 8 OWNERS EQUITY 200 RETAINED EARNS 352 8 TOTAL EQUITY 552 8 TOT LIABS 945 8 EQUITY

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Tim Lumber buys $350,000 more inventory, pays $150,000 cash now, balance due to suppliers next month. Pays cash in Mo. 11 against Accts Payable starting

Tim Lumber buys $350,000 more inventory, pays $150,000 cash now, balance due to suppliers next month. Pays cash in Mo. 11 against Accts Payable starting balance owed from Mo-10 Accts Payable.
Tim Lumber sells $475,000 of inventory to customers for $725,000 net. $450,000 were cash sales, balance of sales on credit due from customers in 30 days in next month’s accounting period.
$140,000 cash is collected in the current Month-11 period on Accts Receivable carried over from Mo.10
Building monthly rent paid cash in current period is $10,000 monthly going forward
Wage expense = $45,000, $30,000 cash, balance paid next period. Mo-10 Wage Payable is paid cash now.
$50,000 is repaid on the Bank loan. Mo. loan interest expense = $1,000, paid cash in current period.
Tim Lumber buys extra $200,000 inventory, pays $50,000 cash, balance on Supplier credit, due in Mo. 12
Office supplies and utilities expense together totaled $30,000, paid cash in the current period
Depreciation expense is $750 per month ($72,000 div. by 8 = $9,000 annual div. by 12 = $750 mo.)
Amortized monthly insurance policies expense of $300 recorded in the current period
Another $75,000 is received in Mo.11 from accts rec. owed by customers who bought on credit in month 11.
Dividends = $10,000 paid cash to Owner in Mo.11 Month-11 Retained Earns = Mo. 11 N.Inc - $10,000 Div
Tim Lumber owes $43,950 income tax on Mo.11 pre-tax profits, pays period 12. Tim Lumber pays Mo-10 Tax payable

PREPARE THE 11 PERIOD INCOME STATEMENT & ENDING BALANCE SHEET

CASH 282.7 WAGES PAYABLE 8 ACCT RECEIVABLE 155 SUPPLIER PAYABLE 220 INVENTORY 443 LOC BANK LOAN 135 Prepaid Curr. Asset .6 TAX. Oth PAYABLE 30 TOT CURR. ASSETS 881.3 CURR. LIABILITIES 393 LT ASSETS Office Eq 64.5 LONG TERM DEBT TOTAL LIABILITIES 393 TOTAL ASSETS 945.8 OWNERS EQUITY 200 RETAINED EARNS 352.8 TOTAL EQUITY 552.8 TOT LIABS & 945.8 EQUITY

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Inventory Particulars amount Particulars amount Beg balace 443 COGS 475 Cash 150 Balance 518 Accounts payable 200 cash 50 Accounts payable 150 993 993 ... blur-text-image