Prepare t accounts in accrual basis for the period

Assignment Help Financial Accounting

Reference no: EM132641118

The following financial statements were prepared at the end of the month of May:

TOPS IN TOPIARY - INCOME STATEMENT FOR the month of May

Revenue $2,540

Expenses:

Rent Expense $500

Advertising Expense $500

Wages Expense $200

$1,200

Net Income $1,340

TOPS IN TOPIARY - STATEMENT OF OWNER'S EQUITY FOR the month of MAY

Owner's Equity at May 1$0nplus: Investmentn2,000nplus:

Net Income1,340 less:

Withdrawals 0

Owner's Equity at May 31 $3,340

TOPS IN TOPIARY - BALANCE SHEET AS OF MAY 31

ASSETS LIABILITES AND OWNER'S EQUITY Current Assets:

Current Liabilities:

Cash $1,380

Accounts Payable $300

Accounts Receivable $1,500

Advertising Payable $500

Prepaid Rent $ 500

Advances from Customers $200

Prepaid Advertising $ 500

Supplies$ 100 $3,980

Equipment$ 360

Owner's Equity $3,340

Total Assets $4,340

Total Liabilities & OE $4,340

During June the following transactions occurred:

1) Paid the helper the $1,000 owed from works done in May (the amount owed is in Accounts Payable).

2) Completed the job for which the customer paid $200 in May. Tops in Topiary collected $2000 in cash once finished.

3) Paid $500 for the rent of July.

4) At the end of June notices that there are no supplies left. Makes a note to buy some in July.

5) At the end of June notices that there are few flyers left (used for advertising) worth $200 and decides to order some for July. Before ordering, the printer (supplier of flyers) asks to be paid $600 of the amount owed for the flyers done in May. Tops in Topiary pays $600.

6) In June collected in cash $3,000 for 3 jobs are done for a total of $4,500, the rest is owed in account by the customers.

7) In June decided to start depreciating the equipment bought for $360 that is expected to last for 3 years.

8) In June 23rd Edward Scissorhands withdrew some cash for personal reasons ($2,000).

Problem 1: Prepare "T" Accounts in ACCRUAL Basis for the period ended on June 30th and then answer the questions.

Problem 2: At the end of the accounting period (June 30th, T account after AJE), what is the total of Current Liabilities?

Reference no: EM132641118

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