Acc121 Survey of Accounting: P2-2 Gary McReynolds established CPU Computer Services

Acc121 Survey of Accounting
P2-2
Gary McReynolds established CPU Computer Services on August 1, 2009. The effect of each transaction and the balances after each transaction for August are shown in the integrated financial statement framework.
Asset Liabilities Stockholders' Equity
Cash Land Notes Payable Capital Stock Retained Earnings Income Statement
Statement of Cash Flows
a. Investment 30,000 30,000
b. Fees earned 18,000 18,000 b
Balance 48,000 - - 30,000 18,000
c. Rent expense (2,500) (2,500) c
Balance 45,500 - - 30,000 15,500
d. Issued notes payable 10,000 10,000
Balance 55,500 - 10,000 30,000 15,500
e. Purchased land (40,000) 40,000
Balance 15,500 40,000 10,000 30,000 15,500
f. Paid expenses (1,650) (1,650) f
Balance 13,850 40,000 10,000 30,000 13,850
g. Paid salary expense (3,600) (3,600) g
Balance 10,250 40,000 10,000 30,000 10,250 Net income
h. Paid dividends (2,000) (2,000)
Balance, August 31 $8,250 $40,000 $10,000 $30,000 $8,250

Statement of Cash Flows
a. Financing 30,000
b. Operating 18,000
c. Operating (2,500)
d. Financing 10,000
e. Investing (40,000)
f. Operating (1,650)
g. Operating (3,600)
h. Financing (2,000)
Increase in Cash $8,250

Instructions:
1. Prepare an income statement for the month ended August 31, 2009.
2. Prepare a retained earnings statement for the month ended August 31, 2009.
3. Prepare a balance sheet as of August 31, 2009.
4. Prepare a statement of cash flows for the month ended August 31, 2009.
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