Question: The following financial statements are available
The following financial statements are available for Elm Corporation for its first month of operations:
Required:
Using the format illustrated in Exhibit 3-1, prepare a table to summarize the transactions entered into by Elm Corporation during its first month of business. State any assumptions you believe are necessary in reconstructing the transactions.
Exhibit 3-1:
Transcribed Image Text:
Elm Corporation Income Statement For the Month of June Service revenue $93,600 Expenses: Rent $ 9,000 Salaries and wages 27,900 Utilities 13,800 50,700 Net income $42,900 Elm Corporation Balance Sheet June 30 Assets Liabilities and Stockholders' Equity Cash $ 22,800 $ 18,000 Accounts payable Notes payable Capital stock Accounts receivable 21,600 90,000 Equipment 18,000 30,000 Building 90,000 Retained earnings 38,400 Land 24,000 Total liabilities and Total assets $176,400 Stockholders' Equity $176,400 Assets Liabilities Stockholders' Equity Trans. Accounts Accounts Notes Capital Retained No. Cash Receivable Equipment Building Land Payable Payable Stock Earnings 1 $100,000 $100,000 2 $150,000 $50,000 $200,000 Bal. $100,000 $150,000 $50,000 $200,000 $100,000 3 $20,000 $20,000 Bal. $100,000 $20,000 $150,000 $50,000 $20,000 $200,000 $100,000 4 $15,000 $ 15,000 Bal. $100,000 $15,000 $20,000 $150,000 $50,000 $20,000 $200,000 $100,000 $ 15,000 5,000 5,000 Bal. $105,000 $15,000 $20,000 $150,000 $50,000 $20,000 $200,000 $100,000 $ 20,000 6 -10,000 -10,000 $ 95,000 $15,000 $20,000 $150,000 $50,000 $20,000 $200,000 $100,000 $ 10,000 Bal. -3,000 $ 92,000 -3,000 $ 7,000 Bal. $15,000 $20,000 $150,000 $50,000 $20,000 $200,000 $100,000 8. 4,000 -4,000 Bal. $ 96,000 $11,000 $20,000 $150,000 $50,000 $20,000 $200,000 $100,000 $ 7,000 -2,000 -2,000 $ 94,000 $11,000 $20,000 $150,000 $50,000 $20,000 $200,000 $100,000 $ 5,000 Total assets: $325,000 Total liabilities and stockholders' equity: $325,000 LO 9.
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