Question: Use the information in Exercise I (if completed, you can also use your solution to Exercise II) to prepare an October 31 balance sheet for Real Solutions.
Exercise II: Use the information in Exercise I to prepare an October statement of owner's equity for Real Solutions.
Exercise I: On October 1, Natalie King organized Real Solutions, a new consulting firm. On October 31, the company's records show the following items and amounts. Use this information to prepare an October income statement for the business.
Cash . . . . . . . . . . . . . . . . . . . . . $ 2,000 Cash withdrawals by owner . . . . . . . . . $ 3,360
Accounts receivable . . . . . . . . 13,000 Consulting fees earned . . . . . . . . . . . . . 15,000
Office supplies . . . . . . . . . .. . . 4,250 Rent expense . . . . . . . . . . . . . . . . . . . . 2,550
Land . . . . . . . . . . . . . . . . . . . . . 36,000 Salaries expense . . . . . . . . . . . . . . . . . . 6,000
Office equipment . . . . . . . . . . 28,000 Telephone expense . . . . . . . . . . . . . . . . 660
Accounts payable . . . . . . . . . . . 7,500 Miscellaneous expenses . . . . . . . . . . . . 680
Owner investments . . . . . . . . . 74,000