You open a consulting business on January 1st and must account for the following transactions during one month:

Day 1: You contribute $10,000 of your own money to the business for initial expenses.

Day 1: Hire an administrative assistant who will work Monday - Friday; pay: $500/week; payday: every two weeks. He begins on day 1.

Day 2: Take care of everyday business start-up issues:

Rent Office Space: You pay $6,000 in advance for the entire first year's rent and $500 as a security deposit.
Buy Insurance: you pay $600 for six months of coverage
Buy Office Supplies: you spend $100
Rent Office Equipment and Furniture: you pay $750 for a 3-month lease
Day 4: You staff a table at a Career Fair and secure 20 clients during the day; you charge $100/client for the advice you provide but offer a 10% discount for cash; half pay you money, the other half promise to pay at the end of the month (Career Fair lasts one day)

Day 12: You receive a $500 fee for making a luncheon presentation at the local Kiwanis Club.

Day 14: Payday for your administrative assistant for two weeks of work.

Day 17: Pay the contracting consultant $1000 to create a training program. The delivery date for program materials is February 15th.

Day 25: You sign a consulting contract that will begin February 1st and pay you $1,000 per month for the remainder of the year.

Day 27: Meet with the attorney to discuss copyright options for the training program the contracting consultant will create. Pay the attorney $500 ($250 per hour) to cover the cost of the meeting.

Day 29: Payday for your administrative assistant for two weeks of work.

Day 30: You secure a loan of $50,000 from your favorite bank and receive the money that day.

Determine:
Of those transactions listed above,

complete the Worksheet_Lesson3.docx Download Worksheet_Lesson3.docx as follows:

Step 1 – Use the Worksheet_Lesson3.docx Download Worksheet_Lesson3.docx document to list the following types of entries that would be made to an income statement:

Revenue

Direct Costs

Indirect Costs
 

Entry Luncheon fee of $500 on Day 5 Worksheet/Lesson 3 Category Revenue Direct Indirect Effect of Comments Cost Cost Revenue or Cost X + 500.00