Prepare an income statement for August

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Problem - Transactions; financial statements - On August 1, 20Y9, Brooke Kline established Western Realty. Brooke completed the following transactions during the month of August:

a. Opened a business bank account with a deposit of $35,000 in exchange for common stock.

b. Purchased supplies on account, $2,750.

c. Paid creditor on account, $1,800.

d. Earned sales commissions, receiving cash, $52,800.

e. Paid rent on office and equipment for the month, $4,500.

f. Paid dividends, $3,000.

g. Paid automobile expenses for month, $1,100, and miscellaneous expenses, $1,200.

h. Paid office salaries, $5,250.

i. Determined that the cost of supplies on hand was $1,750; therefore, the cost of supplies used was $1,000.

Instructions -

1. Indicate the effect of each transaction and the balances after each transaction.

2. Prepare an income statement for August, a statement of stockholders' equity for August, and a balance sheet as of August 31.

Reference no: EM132738601

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