Chapter 1: Q. 16SE (page 36)
Calculating ROA Matured Water Services had net income for the month of October of \(50,880. Assets as of the beginning and end of the month totaled \)362,000, and $486,000, respectively. Calculate Matured Water Services' ROA for the month of October
ROA equals 12%.
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Using the expanded accounting equation, solve for the missing amount. Assets $ 71,288 Liabilities 2,260 Common Stock ? Dividends 14,420 Revenues 53,085 Expenses 28,675
Prepare the balance sheet for Damon Design Studio as of December 31, 2018
You would like to start a cellular telephone equipment service business. You are considering organizing the business as a sole proprietorship. Identify the advantages and disadvantages of owning a sole proprietorship.
Prepare the statement of retained earnings for Damon Design Studio for the year ending December 31, 2018.
Amos Sharp recently opened his own accounting firm on October 1, which he operates as a corporation. The name of the new entity is Amos Sharp, CPA. Sharp experienced the following events during the organizing phase of the new business and its first month of operations in 2018. Oct. 5 Sharp deposited \(45,000 in a new business bank account titled Amos Sharp, CPA. The business issued common stock to Sharp. 6 Paid \)300 cash for letterhead stationery for new office. 7 Purchased office furniture for the office on account, \(6,500. 10 Consulted with tax client and received \)3,300 for services rendered. 11 Paid utilities, \(340. 12 Finished tax hearings on behalf of a client and submitted a bill for accounting services, \)16,000. 18 Paid office rent, \(1,800. 25 Received amount due from client that was billed on October 12. 27 Paid full amount of Accounts Payable created on October 7. 31 Cash dividends of \)3,800 were paid to stockholders. Requirements 1. Analyze the effects of the events on the accounting equation of Amos Sharp, CPA. Use a format similar to Exhibit 1-6. 2. Prepare the following financial statements: a. Income statement. b. Statement of retained earnings. c. Balance sheet.
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