Transaction Analysis and Financial Statements

Just Rolling Along Inc. was organized on May 1 by two college students who recognized an opportunity to make money while spending their days at a beach along Lake Michigan. The two entrepreneurs plan to rent bicycles and in-line skates to weekend visitors to the lakefront. The following transactions occurred during the first month of operations:

May 1:	Received contribution of $8,000 from each of the two principal owners of the new business in exchange for shares of stock.
May 1:	Purchased ten bicycles for $315 each on an open account. The company has 30 days to pay for the bicycles.
May 5:	Registered as a vendor with the city and paid the $15 monthly fee.
May 9:	Purchased 15 pairs of in-line skates at $115 per pair, 15 helmets at $50 each, and 15 sets of protective gear (knee and elbow pads and wrist guards) at $45 per set for cash.
May 10:	Purchased $90 in miscellaneous supplies on account. The company has 30 days to pay for the supplies.
May 15:	Paid $160 bill from local radio station for advertising for the last two weeks of May.
May 17:	Customers rented in-line skates and bicycles for cash of $2,020.
May 24:	Billed the local park district $1,400 for in-line skating lessons provided to neighborhood children. The park district is to pay one-half of the bill within five working days and the rest within 30 days.
May 29:	Received 50% of the amount billed to the park district.
May 30:	Customers rented in-line skates and bicycles for cash of $3,150.
May 30:	Paid wages of $240 to a friend who helped over the weekend.
May 31:	Paid the balance due on the bicycles.

Required:

1. Complete the table below to summarize the preceding transactions as they affect the accounting equation. Enter transactions in the same order as presented above. If an account is unaffected by a transaction, enter "0". Use the minus sign to indicate decreases.

JUST ROLLING ALONG INC. TRANSACTIONS FOR THE MONTH OF MAY
	Assets				=	Liabilities	+	Stockholders' Equity
Date	Cash	Accounts Receivable	Equipment	Supplies		Accounts Payable		Capital Stock	Retained Earnings
May 1	$	$	$	$		$		$	$
May 1
Balance	$	$	$	$		$		$	$
May 5
Balance	$	$	$	$		$		$	$
May 9
Balance	$	$	$	$		$		$	$
May 10
Balance	$	$	$	$		$		$	$
May 15
Balance	$	$	$	$		$		$	$
May 17
Balance	$	$	$	$		$		$	$
May 24
Balance	$	$	$	$		$		$	$
May 29
Balance	$	$	$	$		$		$	$
May 30
Balance	$	$	$	$		$		$	$
May 30
Balance	$	$	$	$		$		$	$
May 31
Balance	$	$	$	$		$		$	$
	Total Assets:	$			Total liabilities and stockholders' Equity:			$

2. Prepare an income statement for the month of May.

Just Rolling Along Inc.
Income Statement
For the Month of May
Revenues:
	$
Total Revenues		$
Expenses:
	$
Total Expenses
		$

3. Prepare a classified balance sheet at May 31.

Just Rolling Along Inc.
Balance Sheet
May 31
Assets
Current assets:
	$
Total current assets		$
Property, plant, and equipment:
Total assets		$
Liabilities and Stockholders' Equity
Current liabilities:
		$
	$
Total stockholders' equity
Total liabilities and stockholders' equity		$

Which of the following statement is incorrect?