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On August 31, the balance sheet of La Brava Veterinary Clinic showed Cash $9,000, Accounts Receivable $1,700, Supplies $600, Equipment $6,000, Accounts Payable $3,600, Common Stock $13,000, and Retained Earnings $700. During September, the following transactions occurred;

a. Paid $2,900 cash for accounts payable due.
b. Collected $1,300 of accounts receivable.
c. Purchased additional equipment for $2,100, paying $800 in cash and the balance on account.
d. Recognized revenue of $7,300, of which $2,500 is collected in cash and the balance is due in October.
e. Declared and paid a $400 cash dividend.
f. Paid salaries $1,700, rent for September $900, and advertising expense $200.
g. Incurred utilities expense for month on account $170.
h. Received $10,000 from Capital Bank on a 6-month note payable.

Instructions
Prepare a tabular analysis of the September transactions beginning with August 31 balances. The column headings should be as follows: Cash + Accounts Receivable + Supplies + Equipment = Notes Payable + Accounts Payable + Common Stock + Retained Earnings + Revenues – Expenses – Dividends.
Prepare an income statement for September, a retained earnings statement for September, and a balance sheet at September 30.

Respuesta :

mchaid015

Answer:

1. See attached file for the tabular analysis

2.                   La Brava Veterinary Clinic  

                             Income Statement  

                For the month Ended September 30  

 

         Revenue          $7,300

         Less: Operating expenses  

        Salaries expense    1,700

        Rent expense      900

        Advertising expense  200

         Utilities expense      170

        Total operating expense 2,970              

 Net Income   $4,330

3.                           La Brava Veterinary Clinic    

                        Statement of Retained Earnings    

                               For the month Ended September 30    

   

Beginning balance         $700

Add: Net income                   4,330

Less: Dividends                        400                                    

    Ending balance              $4,630

   

4.         La Brava Veterinary Clinic  

                  Balance Sheet  

              As of September 30  

 

                   Asset  

Current Assets  

Cash                        $15,900

Accounts receivable   5,200

Office supplies              600  

Total current assets   21,700

Non-current assets  

Equipment                    8,100  

Total non-current assets         8,100

 

Total assets                 $29,800

  Liabilities and Equity

Current liability  

Accounts Payable    $2,000

Accrued expenses        170    

Total current liabilities     2,170

 

Non-current liability  

Note Payable                   $10,000  

Total non-current liabilities  $10,000

Total liabilities            $12,170

                            Equity  

Capital stock                    $13,000

Retained earnings               4,630

Total equity                     $17,630  

Total liabilities and Equity      $29,800

Explanation:

1. Entries for the month of September

a. Debit Accounts payable $2,900

Credit Cash $2,900

b. Debit cash $1,300

Credit Accounts receivable $1,300

c. Debit Equipment $2,100

Credit Cash $800

Credit Notes payable $1,300

d. Debit Cash $2,500

Debit Accounts receivable $4,800

Credit Accounts receivable $7,300

e. Debit Dividends   $400

Credit Cash $400

f.  Debit Salaries expense $1,700

Debit Rent expense $900

Debit advertising expense $200

Credit Cash $2,800

g. Debit utilities expense $170

Credit accrued expense $170

h. Debit cash $10,000

Credit Notes payable $10,000

All of these transactions will be posted in the tabular analysis.