Exercise 4.

  Perez Company had the following transactions during January:

1.  Jan 1  Issued $100,000 in stock to owners in exchange for cash to start the
business.
2.  Jan 5  Borrowed $50,000 from the bank by signing a notes payable.
3.  Jan 10  Purchase equipment by paying cash for $25,000.
3.  Jan 15  Paid January rent of $2,400 for the office space (hint:  since this is for
January, record as rent expense)
4.  Jan 18 Performed services for customers and received cash immediately for $8,000.
5.  Jan 20  Purchased $2,000 in supplies on account.
Prepare a transaction analysis for the January transactions.  Remember to prove the
accounting equation at the end.

Assets   = Liability  + Equity +

Equipmen Accounts Notes Common Ser

Transaction Cash Supplies
t Payable Payable Stock Rev

Jan 1 Issued stock to owners

Jan 5 Borrowed money from bank

Jan 10 Purchased equipment with

cash

Jan 15 Paid January rent

Jan 18 Performed services

Jan 20 Purchased supplies on

account

Balance:              

 
Exercise 5.  On December 31, Bryniuk’s Company, the accounting records
showed the following information:
Cash           49,5

Accounts Receivable          125,0

Supplies              1,5

Prepaid Insurance            12,0

 Equipment            70,0

Building       420,00

Land          111,5

Accounts Payable            80,0

Notes Payable          170,0

Common Stock          410,0

Retained Earnings           65,0

Dividends            20,0

Service Revenue          174,0

Interest Revenue              1,0

Salaries Expense            52,0

Advertising Expense            17,0

Insurance Expense              5,0

Utilities Expense            13,7

Interest Expense              2,7

Prepare the Income Statement for year ended December 31.

Bryniuk’s Company

Income Statement

For Year Ended December 31

Revenues:             .

Total Revenues

 
Expenses:

Total Expenses

Net Income