Assets Liabilities

Land $ 90,000 Accounts Payable $ 43,800

Accounts Receivab $ 56,700 Notes Payable $ 207,000
Cash $ 36,300 Equity
Office Equipment $ 12,400 Capital Stock $ 88,000
Building $ 210,000 Retained Earnings $ 66,600
 Assets Liabilities Owners' Equity
a. $ 635,000 $ 342,000 $ 293,000
b. $ 1,172,500 $ 562,500 $ 610,000
c. $ 307,500 $ 120,300 $ 187,200
Transaction Assets Liabilities Owners' Equity
(a) I I NE
(b) NE NE NE
(c) D D NE
(d) D D NE
(e) I NE I
(f) I I NE
(g) I NE I
(h) NE NE NE
(i) NE NE NE
Transaction Net Income Assets
(a) NE I
(b) NE I
(c) D NE
(d) NE NE
(e) NE D
(f) NE NE
(g) NE NE
(h) NE NE
Liabilities Owners' Equity
NE I
I NE
I D
NE NE
D NE
I D
NE NE
NE NE
a. Date Account Titles and Explanation
May. 3 Cash
Capital Stock
May. 4 Office Rent Expense
Cash
May. 5 Office Supplies
Cash
May. 15 Office Equipment
Accounts Payable
May. 18 Vehicles
Cash
Notes Payable
May. 20 Accounts Receivable
Client Revenue
May. 26 Dividends
Dividends Payable
May. 29 Utilities Xxpense
Cash
May. 30 Cash
Accounts Receivable
May. 31 Salary Expense
Cash

b. Cash
May. 3 $950,000
May. 30 $90,000

Accounts Receivable
May. 20 $120,000

Office Supplies
May. 5 $600
 Office Equipment
May. 15 $12,400

Vehicles
May. 18 $45,000

Notes Payable

Accounts Payable

Dividends Payable

Dividends
May. 26 $8,000

Capital Stock

Client Revenue

Office Rent Expense

May. 4 $1,800

Salary Expense
May. 31 $32,000

Utilities Expense
May. 29 $500

c. Trial Balance
Accounts Debit
Cash $990,100
Accounts Receivable $30,000
Office Supplies $600
Office Equipment $12,400
Vehicles $45,000
Notes Payable
Accounts Payable
Dividends Payable
Dividends $8,000
Capital Stock
Client Revenue
Office Rent Expense $1,800
Salary Expense $32,000
Utilities Expense $500
$1,120,400
 Debit Credit
$950,000
$950,000
$1,800
$1,800
$600
$600
$12,400
$12,400
$45,000
$15,000
$30,000
$120,000
$120,000
$8,000
$8,000
$500
$500
$90,000
$90,000
$32,000
$32,000

Cash
May. 4 $1,800
May. 5 $600
May. 18 $15,000
May. 29 $500
May. 31 $32,000

Accounts Receivable
May. 30 $90,000

Office Supplies
 Office Equipment

Vehicles

Notes Payable
May. 18 $30,000

Accounts Payable
May. 15 $12,400

Dividends Payable
May. 26 $8,000

Dividends

Capital Stock
May. 3 $950,000

Client Revenue
May. 20 $120,000

Office Rent Expense

Salary Expense

Utilities Expense

nce
Credit
 $30,000
$12,400
$8,000

$950,000
$120,000

$1,120,400
 Income Statement Balance Sheet
Adjusting Entry Revenue Expenses Income Assets
a. NE I D D
b. NE I D NE
c. I NE I I
d. NE I D NE
e. NE I D D
f. I NE I I
 Balance Sheet
Liabilities Owners' Equity
NE D
I D
NE I
I D
NE D
D NE
 Account Debit Credit
May. 31 Rent Expense $22,000.00
Prepaid Rent $22,000.00
May. 31 Unearned Ticket Revenue $7,000.00
Ticket Revenue $7,000.00
 Income Statement
Account Debit Credit
Lawn Care Revenue Earned $ 230,400
Salary Expense $ 124,800
Supply Expense $ 2,880
Advertising Expense $ 720
Depreciation Expens $ 2,400
Income Taxes Expens $ 27,840
Net Income $ 71,760

Statement of Retained Earnings

Account Debit Credit
Retained Earnings $ 108,000
Net Income $ 71,760
Dividends $ 4,800
Retained Earnings (12.31) $ 174,960

Balance Sheet
Assets Liabilities
Cash $ 218,640 Accounts Payable $ 3,600
Accounts Receivable $ 10,800 Income Taxes Payabl $ 8,400
Supplies $ 720 Owners' Equity
Equipment $ 28,800 Capital Stock $ 60,000
Accumulated Depreci $ -12,000 Retained Earnings ( $ 174,960
Total Assets $ 246,960 Total Liabilities a $ 246,960

b. Current Ratio 19.18

Yes. A current ratio higher than 1 means that a company's current assets cover its

c. Yes. Because the retained earnings is positive at the beginning of the preriod.
s current assets cover its current liabilities. The company's current ratio is as high as 19.28, indicating that

ginning of the preriod.

igh as 19.28, indicating that it has good liquidity.