Cash balance should equal $13,100. On October 1 of the current year, Mrs. Ima Ge

ID: 2330858 • Letter: C

Question

Cash balance should equal $13,100.

On October 1 of the current year, Mrs. Ima Genius opened up a Tutoring Business called Genius in Process; a sole proprietorship located in Southern California. The business had the following transactions occur during the first month of business. Opened a business checking account in the name of the business and d $25,000 Paid $2,000 to the landlord for rent for October. Purchased equipment to be used in the business for $15,000. Paid 20% down and the rest on account (to be paid 30 days later.) a. b. C. d. Purchased materials and other supplies to be used in the business for $2,500 orn account. Brought in $3,500 in cash for work performed during the first few weeks of the month. Sold other tutoring services on account for $2,100 to be paid within 30 days. Appeared as a guest speaker at an after school day care for a fee of $1,000 billing the hosts. The amount is due next month. Paid Gecko Insurance $1,200 for the annual insurance premium to cover the business assets. Paid the monthly utility bill of $1,500 the same day it arrived in the mail. On the last day of the month, paid $5,000 wages to the workers. (They are considered independent contractors, so there are no payroll tax issues. Returned $200 of the supplies purchased earlier because they were the wrong kind (The supplies had not yet been paid for.) e. f. g. h. i. j. k. I. Received $500 in cash for a partial payment on services billed on account earlier. m. Withdrew cash for personal use in the amount of $3,200.

Explanation / Answer

Opened a account & Deposit

25000

(-) Paid Rent to Landlord

2000

(-) Purchased Equipment (15000 * 20%)

3000

(+) Work performed in first week

3500

(-) Paid Gecko Insurance

1200

(-) Paid monthly utility bill

1500

(-) Paid to workers

5000

(+) Received partial payment of service

500

(-) Withdraw for personal use

3200

13100