Accounting Question

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.

Required:
1.	Indicate the effect of each transaction and the balances after each transaction, using the following tabular headings:

holders’ Equity

+Supplies=

+Stock

–

-Expense-Expense-Expense-Expense

Assets

Liabilities

Stock

Accounts

Common

Sales

Salaries

Rent

Auto

Supplies

Miscellaneous

Cash

Payable

–

Dividends

Commissions

Expense

2. a. Prepare an income statement for August.

2. b. Prepare a statement of stockholders’ equity for August.

2. c. Prepare a balance sheet as of August 31.

Accounts
Accounts payable
Automobile expense
Cash
Common stock
Accounts
Dividends
Miscellaneous expense
Rent expense
Retained earnings
Salaries expense
Sales commissions
Supplies
Supplies expense
Labels
August 31, 20Y9
Expenses
For the Month Ended August 31, 20Y9
Amount Descriptions
Balances, August 1, 20Y9
Balances, August 31, 20Y9
Issued common stock
Net income
Net loss
Total assets
Total expenses
Total liabilities and stockholders’ equity
Total stockholders’ equity

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