Nina Finzelberg started her own consulting firm, Finzelberg Consulting Inc., on May 1, 2014. The following transactions occurred during the month of May.
May 1 Stockholders invested $ 15,000 cash in the business in exchange for common stock.
2 Paid $ 600 for office rent for the month.
3 Purchased $ 500 of supplies on account.
5 Paid $ 150 to advertise in the County News.
9 Received $ 1,400 cash for services performed.
12 Paid $ 200 cash dividend.
15 Performed $ 4,200 of services on account.
17 Paid $ 2,500 for employee salaries.
20 Paid for the supplies purchased on account on May 3.
23 Received a cash payment of $ 1,200 for services performed on account on May 15.
26 Borrowed $ 5,000 from the bank on a note payable.
29 Purchased office equipment for $ 2,000 paying $ 200 in cash and the balance on account.
30 Paid $ 180 for utilities.
1.Show the effects of the above transactions on the accounting equation using the following format. Assume the note payable is to be repaid within the year.
2. Prepare an income statement for the month of May 2014.
3. Prepare a classified balance sheet at May 31, 2014. (List current assets in order of liquidity)