1. Transactions;Financial Statements
2. D'Lite Dry Cleaners is owned and operated by Joel Palk. A building and equipment are currently being rented, pending expansion to new facilities. The actual work of dry cleaning is done by another company at wholesale rates. Theassets,liabilities, and common stock of thebusinesson July 1, 2018, are as follows: Cash, $17,640;Accounts Receivable, $46,120; Supplies, $3,360; Land, $42,000;Accounts payable, $15,120; Common Stock, $10,000.Business transactionsduring July are summarized as follows:
3. Joel Palk invested additional cash in exchange for common stock with a deposit of $32,000 in the business bank account.
4. Paid $15,800 for the purchase of land adjacent to land currently owned by D'Lite Dry Cleaners as a future building site.
5. Received cash from customers for dry cleaning revenue, $19,320.
6. Paid rent for the month, $5,800.
7. Purchased supplies on account, $2,700.
8. Paid creditors on account, $14,300.
9. Charged customers for dry cleaning revenue on account, $38,640.
10. Received monthly invoice for dry cleaning expense for July (to be paid on August 10), $15,460.
11. Paid the following: wages expense, $8,500; truck expense, $3,090; utilities expense, $3,280; miscellaneous expense, $1,470.
12. Received cash from customers on account, $30,910.
13. Determined that the cost of supplies on hand was $2,130; therefore, the cost of supplies used during the month was $3,930.
14. Paid dividends, $8,900.
15. Required:
16. 1.Determine the amount of retained earnings as of July 1, 2018.
17. $fill in the blank 030508013ff4fa3_1
19. 2.Use the attachedspreadsheetto complete part 2. Click on the Spreadsheet icon above to open and save the Excel file to your computer. Your input into the spreadsheet will not be included in your grade in CengageNOW on this problem.
20. The assets, liabilities, andstockholders' equityas of July 1 are presented in equation form similar to that shown in this chapter. In tabular form below the equation, indicate increases and decreases resulting from each transaction and the new balances after each transaction.
21. 3.Using the balances from the spreadsheet, prepare anincome statementfor July, aretained earnings statementfor July, and abalance sheetas of July 31.
22. Income StatementD'Lite Dry Cleaners
23. Income Statement
24. For the Month Ended July 31, 20181
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26. 2
27. 3
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29. 4
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31. 5
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33. 6
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35. 7
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37. 8
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39. 9
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41. 10
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43. 11
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46. Retained Earnings StatementD'Lite Dry Cleaners
47. Retained Earnings Statement
48. For the Month Ended July 31, 20181
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50. 2
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52. 3
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54. 4
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56. 5
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59. Balance sheet as of July 31:
60. When entering assets, enter them in order of liquidity.
61. Balance SheetD'Lite Dry Cleaners
62. Balance Sheet
63. July 31, 20181
65. 2
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69. 3
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71. 4
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74. 5
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78. 6
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82. 8
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87. 4.Prepare astatement of cash flowsfor July.
88. Use the minus sign to indicate cash outflows, decreases in cash, and cash payments.
89. Statement of Cash FlowsD'Lite Dry Cleaners
90. Statement of Cash Flows
91. For the Month Ended July 31, 20181Cash flows from operating activities:2
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93. 3
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95. 4Net cash flows from operating activitiesfill in the blank b2806b04e03b055_59
96. 5Cash flows used for investing activities:6
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98. 7Cash flows from financing activities:8
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100. 9
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102. 10Net cash flows from financing activitiesfill in the blank b2806b04e03b055_66
103. 11Net Increase in cashfill in the blank b2806b04e03b055_67
104. 12Cash balance, July 1, 2018fill in the blank b2806b04e03b055_68
105. 13Cash balance, July 31, 2018fill in the blank b2806b04e03b055_69