Question - Maria Lange opened a medical practice. During July, the first month of operation, the business, named M. Lange, M. D., P.C. experienced the following events:
07/01 Lange invested $45,000 in the business by opening a bank account in the name of M. Lange, M. D., P.C. The corporation issued common stock to Lange.
07/02 Paid $35,000 cash for land.
07/03 Purchased medical supplies for $2,000 on account.
07/07 Officially opened for business.
07/08-31 During the rest of the month, Lange treated patients and earned service revenue of $7,000, receiving cash as payment.
07/08-31 Paid cash expenses: employee salaries, $1,700; office rent, $1,000; utilities,$300.
07/28 Sold supplies to another physician for the costs of those supplies, $500.
07/31 Paid $1,500 on account.
Requirements:
1. Prepare journal entries for the preceding transactions.
2. Prepare income statement for the month ended 07/31/XX.
3. Prepare the balance sheet for 07/31/XX.