Anchorage Travel Agency
On June 1, Linda established Anchorage Travel Agency. The following transactions were completed during the month.
(1) Linda invested RM30,000 cash in the business.
(2) Paid RM20,000 cash for land.
(3) Bought RM500 of office supplies on credit.
(4) Received RM5,500 cash from clients for the service revenue earned.
(5) Performed travel service for clients on credit, RM3,000.
(6) Paid cash expenses : computer lease RM600, office rent RM1,100, employee salary RM 1,200, electricity RM400.
(7) Paid RM300 on the account payable created in transaction 3.
(8) Renovation of Linda's house RM5,000. This is not a transaction of the business.
(9) Collected RM1,000 on the account receivable created in transaction 5.
(10) Sold land for cash at its cost at RM50,000.
(11) Withdrew RM2,000 cash for personal expenses.
Instructions :
a) Prepare a tabular analysis of the transactions using the following column headings: Cash, Account receivable, Office Supplies, Land, Account payable, Linda capital and Retained earnings.
b) From an analysis of the column Linda, capital, compute the net income or net loss for June.