During the first month of operations for a new corporation, the following transactions are made.
Write a brief explanation of each transaction. Compute the ending balance in each account and prepare an income statement and classified balance sheet.
(a) Cash = +$48,000, Contributed Capital = +$48,000
(b) Cash = -$12,000, Supplies = +$12,000
(c) Cash = -$4,000, Inventory +$19,000, Accounts payable = +$15,000
(d) Cash = +$8,300, Accounts Receivable = +$2,700, Inventory -$2,220, Sales Revenue = +$11,000, Cost of Sales = +$2,220
(e) Accounts Payable = +$1,420, Utilities Expense = +1,420
(f) Cash = -$2,400, Wages Expense = +$2,400
(g) Cash = -$1,110, Prepaid Expenses = +$8,000, Rent Expense +$310
(h) Cash = +$3,300, Unearned Revenue = +$2,080, Sales Revenue = +$1,220