Assignment
Holden Graham started The Gram Co., a new business that began operations on May 1. The Gram Co. completed the following transactions during its first month of operations.
May 1 G. Gram invested $43,000 cash in the company in exchange for its common stock.
1 The company rented a furnished office and paid $2,200 cash for May's rent..
3 The company purchased $1,870 of office equipment on credit.
5 The company paid $740 cash for this month's cleaning services.
8 The company provided consulting services for a client and immediately collected $5,500 cash.
12 The company provided $2,500 of consulting services for a client on credit.
15 The company paid $800 cash for an assistant's salary for the first half of this month.
20 The company received $2,500 cash payment for the services provided on May 12.
22 The company provided $3,400 of consulting services on credit.
25 The company received $3,400 cash payment for the services provided on May 22.
26 The company paid $1,870 cash for the office equipment purchased on May 3.
27 The company purchased $85 of advertising in this month's (May) local paper on credit; cash payment is due June 1.
28 The company paid $800 cash for an assistant's salary for the second half of this month.
30 The company paid $400 cash for this month's telephone bill.
30 The company paid $250 cash for this month's utilities.
31 The company paid $1,900 cash in dividends to the owner (sole shareholder).
Required:
1. Enter the amount of each transaction on individual items of the accounting equation. Do not determine new account balances after each transaction.
2. Prepare Balance Sheet for May 31.
Prepare statement of retained earnings for May.
3. Prepare income statement for May.