Reference no: EM133051402

Comprehensive Learning Assessment

Chau Pham launched a new business called Pham's Maintenance Co. that began operations on June 1, 2021. The following transactions were completed by the company during the first month:

Pham invested $175,000 in the business in exchange for common stock. Rented a furnished office and paid $7,500 cash for June's rent. Purchased $3,000 worth of equipment from Skyline Office equipment paying $1,000 cash with the balance being paid in 20 days. Paid $1,300 cash to advertise the grand opening of the business.

Performed maintenance services for a customer and was immediately paid $1,000 in cash. Performed $8,500 of maintenance services for PDQ Company on credit. Paid $300 in cash to Hernandez Bookkeeping Services for work performed during June.

Received $8,500 from PDQ Company for maintenance work done on June 10. Performed maintenance services totaling $650. The customer paid cash immediately. Performed $1,250 of maintenance services on credit for Patel Realty. Performed $8,500 of maintenance services on credit for the Alaska Mall. Paid $2,000 balance due to Skyline for the equipment purchased on June 4. Received $1,250 in cash for services performed for Lee Realty on June 22. Paid $250 cash for this month's telephone bill. Paid $750 cash for utilities.

Paid $3,000 cash for dividends.

Required:
1. Arrange the following asset, liability, and equity titles in a table: Cash; Accounts Receivable;
Equipment; Accounts Payable; Common Stock;
and Retained Earnings.
a. Include an Explanation column for changes in equity.

2. Show the effects of the transactions on the accounts of the accounting equation by recording the increases and decreases in the appropriate columns.
a. Do not determine new account balances after each transaction.
b. Next to each change in equity, state whether it was caused by an investment, a revenue, an expense, or a dividend.
c. Determine the final total for each account and verify that the equation is in balance.

3. Prepare a June unadjusted income statement, a June unadjusted statement of retained earnings, a June 30 unadjusted balance sheet, and a June unadjusted statement of cash flows.