Accounting Solution 2.1 (Accounting for Accruals)
See the analysis of transactions in the table below. Only some transactions have detailed explanations.
Transaction #1: Cash contribution
|
Assets |
... |
Equity |
|
Cash |
... |
Contributed Capital |
Beginning Balances |
$ 0 |
|
$ 0 |
1) Cash Contribution |
+6,000 |
|
+6,000 |
Ending Balances |
6,000 |
|
6,000 |
Transaction #2: Revenue recognition
|
Assets |
... |
Equity |
|
Accounts Receivable |
... |
Retained Earnings |
Beginning Balances |
$ 0 |
|
$ 0 |
2) Revenue Recognition |
+2,000 |
|
+2,000 |
Ending Balances |
2,000 |
|
2,000 |
Transaction #3: Cash collection
|
Assets |
... |
Assets |
|
Cash |
... |
Accounts Receivable |
Beginning Balances |
$6,000 |
|
$2,000 |
3) Cash Collection |
+1,500 |
|
-1,500 |
Ending Balances |
7,500 |
|
500 |
Transaction #4: Rent payment
|
Assets |
... |
Equity |
|
Cash |
... |
Retained Earnings |
Beginning Balances |
$7,500 |
|
$2,000 |
4) Rent Payment |
-400 |
|
-400 |
Ending Balances |
7,100 |
|
1,600 |
Transaction #5: Salaries payment
|
Assets |
... |
Equity |
|
Cash |
... |
Retained Earnings |
Beginning Balances |
$7,100 |
|
$1,600 |
5) Salaries Payment |
-300 |
|
-300 |
Ending Balances |
6,800 |
|
1,300 |
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