Critical Thinking Problem 3.2 (Algo) Sole Proprietorship LO 3-1, 3-2, 3-3, 3-4, 3-5, 3-6
Sara-Jayne Parsons is an architect who operates her own business. The accounts and transactions for the business follow.
Transactions
a. Sara-Jayne Parsons Invested $20,000 in cash to start the business
b. Paid $2,000 for advertisements in a design magazine.
c. Purchased furniture for $4,400 in cash.
d. Performed services for $6,300 in cash.
e. Paid $245 for the monthly telephone bill.
f. Performed services for $1,700 on credit.
g. Purchased equipment, a fax machine, for $500; paid $75 in cash, with the balance due in 30 days.
h. Paid a bill for $620 from the office cleaning service (debit miscellaneous expense).
i. Received $1,680 from clients on account.
j. Purchased furniture (office chairs) for $615; received credit terms of 30 days.
k. Paid $4,700 for salaries.
l. Issued a check for $260 in partial payment of the amount owed for furniture (office chairs).
m. Received $2,440 in cash for services performed.
n. Issued a check for $530 for utilities expense
o. Performed services for $2,220 on credit
p. Collected $970 from clients on account.
q. Sara-Jayne Parsons withdrew $2,570 in cash for personal expenses.
r. Paid $670 to Quick Copy for photocopy work performed during the month (debit miscellaneous expense).
(Hint: Include office cleaning services and photocopy expenses under "Miscellaneous Expense".)
Required:
(1) Post the above transactions into the appropriate T accounts.
(2) Determine the account balances. Prepare a trial balance, an Income statement, a statement of owner's equity, and a balance sheet for Sara-Jayne Parsons, Architect.
Analyze:
Using the basic accounting equation, what is the financial condition of Sara-Jayne Parsons's business at the end of the month?
Complete this question by entering your answers in the tabs below.
Post the above transactions into the appropriate T accounts.
Ch 3 Critical Thinking Problems
Critical Thinking Problem 3.2 (Algo) Sole Proprietorship LO 3-1, 3-2, 3-3, 3-46, 3-5, 3-6
Transactions
a. Sara-Jayne Parsons Invested $20,000 in cash to start the business n. Paid $2,000 for advertisements in a design magazine. c. Purchased furniture for $4,400 in cash. d. Performed services for $6,300 in cash e. Paid $245 for the monthly telephone bill f. Performed services for $1,700 on credit g. Purchased equipment, fax machine, for $500; paid $75 in cash, with the balance due in 30 days. P. Paid a bill for $620 from the office cleaning service (debit miscellaneous expense) l. Received $1,680 from clients on account. I, Purchased furniture (office chairs) for $615; received credit terms of 30 days. .Paid$4,7001or salaries. I, Issued a check for $260 in partial payment of the amount owed for furniture (office chairs) m. Received $2,440 in cash for services performed.
D
ervices for $2,220 on credit
q. Sara-Jayne Pa
s withdrew $2,570 in cash for personal expenses med during the mo
Aninciude office cleaning services and photocopy expenses under Miscellaneous Expense*
Required: (i Post the above transactions into the appropriate T accounts.
Analyze
financial condition of Sara-Jayne Parsons's business at the end of the month?
n the table below
ance She
Post the above trans
