Problem - SultanCompany started its operations on January 1, 2015. The following transactions took place during the first month of operations:
Jan 1: Sultaninvests $950,000 cash to start the business.
Jan 3: Purchased furniture for $120,000, paying $40,000 in cash and sign a note for the remaining balance.
Jan 7: Purchased supplies for $6,600 on credit.
Jan 13: Paid $11,000 cash for January rent.
Jan 18: Paid $2,600 cash for office supplies purchased on January 7.
Jan 23: Services billed to customers amount to $50,000.
Jan 25: Received utility bills for $12,000 for the month of January.
Jan 28: Paid $30,000 cash for salaries.
Jan 30: Received $40,000 cash from customers in payment for services billed on January 23.
Jan 31: Sultanwithdrew $8,400 from the business for personal use.
Required:
1. Using a table, show the effect of the above transactions on the accounting equation.
2. Prepare Journal entries to record the above transactions.
3. Post to the appropriate ledger accounts.
4. Prepare the trial balance on January 31, 2015.
5. Prepare the financial statements of Sultan Company on January 31, 2015.
6. Prepare closing entrieson January 31, 2015.
7. Prepare the after-closing trial balance.