Reference no: EM132736807

X Company, a manufacturer, prepares monthly financial statements. On May 1, total equities were $115,478. The following transactions occurred during May:

1. Issued additional shares of stock for $118,000.
2. Acquired $8,800 of direct materials, 56% of of which was acquired on open accounts; the rest was paid in cash.
3. A one year rental agreement was signed for $5,200 per month. Rent for the first two months was paid in advance.
4. Product sales were $124,000; product costs were 78% of sales. 76% of the sales were on open account.
5. Wages and salaries amounted to $11,455, of which $10,570 was paid.
6. Paid $3,610 to suppliers for materials that X Company had previously purchased on account.
7. Collected $3,912 from customers who had previously purchased products from X Company on account.
8. Bought equipment for $84,300 with a down payment of $19,500 and a $64,800 loan from the bank.

Problem 1: What would total equities be on May 31?

Problem 2: What would Net Income be for May?