Balance Sheet
The following equation shows the transactions of Cotton Cleaning Service during May. The business is owned by Taylor Cotton.
|
|
Assets |
= |
Liab. |
+ |
Owner’s Equity |
|
||||||||||
|
|
Cash |
+ |
Accts. Rec. |
+ |
Supp. |
+ |
Equip. |
= |
Accts. Pay. |
+ |
T.Cotton, Capital |
+ |
Rev. |
− |
Exp. |
|
|
Balances, May 1 |
14,600 |
+ |
2,600 |
+ |
5,400 |
+ |
33,400 |
= |
6,600 |
+ |
49,400 |
+ |
0 |
− |
0 |
|
|
Paid for utilities |
− 940 |
|
|
|
|
|
|
|
|
|
|
|
|
|
+ 940 |
|
|
New balances |
13,660 |
+ |
2,600 |
+ |
5,400 |
+ |
33,400 |
= |
6,600 |
+ |
49,400 |
+ |
0 |
− |
940 |
|
|
Sold services for cash |
+ 4,940 |
|
|
|
|
|
|
|
|
|
|
|
+ 4,940 |
|
|
|
|
New balances |
18,600 |
+ |
2,600 |
+ |
5,400 |
+ |
33,400 |
= |
6,600 |
+ |
49,400 |
+ |
4,940 |
− |
940 |
|
|
Paid a creditor |
− 1,900 |
|
|
|
|
|
|
|
− 1,900 |
|
|
|
|
|
|
|
|
New balances |
16,700 |
+ |
2,600 |
+ |
5,400 |
+ |
33,400 |
= |
4,700 |
+ |
49,400 |
+ |
4,940 |
− |
940 |
|
|
Sold services on credit |
|
|
+ 2,700 |
|
|
|
|
|
|
|
|
|
+ 2,700 |
|
|
|
|
New balances |
16,700 |
+ |
5,300 |
+ |
5,400 |
+ |
33,400 |
= |
4,700 |
+ |
49,400 |
+ |
7,640 |
− |
940 |
|
|
Paid salaries |
− 8,700 |
|
|
|
|
|
|
|
|
|
|
|
|
|
+ 8,700 |
|
|
New balances |
8,000 |
+ |
5,300 |
+ |
5,400 |
+ |
33,400 |
= |
4,700 |
+ |
49,400 |
+ |
7,640 |
− |
9,640 |
|
|
Paid telephone bill |
− 310 |
|
|
|
|
|
|
|
|
|
|
|
|
|
+ 310 |
|
|
New balances |
7,690 |
+ |
5,300 |
+ |
5,400 |
+ |
33,400 |
= |
4,700 |
+ |
49,400 |
+ |
7,640 |
− |
9,950 |
|
|
Withdrew cash for personal expenses |
− 2,600 |
|
|
|
|
|
|
|
|
|
− 2,600 |
|
|
|
|
|
|
New balances |
5,090 |
+ |
5,300 |
+ |
5,400 |
+ |
33,400 |
= |
4,700 |
+ |
46,800 |
+ |
7,640 |
− |
9,950 |
|
|
|
Required: Analyze each transaction carefully. Prepare an income statement and a statement of owner’s equity for the month. Prepare a balance sheet for May 31, 2019.