Question

Exercise 1-22 Effects of transactions on the accounting equation L06, 7 eXcel CHECK FIGURE: Accounts payable, March 31, 2020 = $2,350 a. Ali Omar invested 54,300 cash and $15,000 of equipment to start his business, Omar's Yard Care. b. Purchased various supplies on account; $1,600. c. Bought supplies on credit; $950. d. Omar signed a $4,000 contract to do yard work beginning in May. e. Did work for a client on account; $550. f. Performed services for a customer on credit; $600. g. Paid $200 for the supplies purchased in (c). h. Paid $250 for advertising online. i. Collected the amount owed from the customer in (f). 59 CHAPTER 1 Accounting in Business Using the format provided below, show the effects of the activities listed in (a) through (i). For each trans- action that affects equity, include a brief description beside it (owner investment, owner withdrawal, revenue, expense). Liabilities + Assets Accounts Cash + Receivable + Supplies + Equipment Accounts Payable Equity Ali Omar, Capital Explanation of Equity Transaction + Exercise 1-23 Financial statements Los CHECK FIGURE: Ali Omar, Capital, March 31, 2020 = $20,200 Using your answer from Exercise 1-22, prepare an income statement, statement of changes in equity, and bal- ance sheet for March 2020. Analysis Component: Review Omar's income statement. Does the profit of $900 represent $900 of cash? Explain.

PLEASE DO 1-22 & 1-23
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Answer 1

Answer:

Assets Liabilities + Equity Accounts Accounts Ali Omar, Explanation of equity Cash + Receivable + Supplies - Equipment = Payable + Capital transaction $ 4,300 + + $ 15,000 = + $ 19,300 Owner investment + $ 1,600 + = $ 1,600 + + $ 950 + = $ 950 + + + + + + + + عاشه انه | ته انه ان اه| + 550 + 600 + + + 550 Revenue 600 Revenue + $ + $ (200) + + $ + + $ + $ $ (200) + $ (250) + $ 600 + $ $ 4,450 + $ $ + + + (250) Expense i. + + (600) + 550 + $ 2,550 + $ 15,000 $ 2,350 + $ 20,200 d. Signed a $4,000 contract to do yard work beginning in May, is not affect financials

Income statement For the month ended March 31, 2020 Service revenue $ 1,150 Expenses Advertisement expense $ 250 Total expenses $ 250 Net income $ 900 $ 4,450 $ 550 $ 2,550 Balance Sheet As of March 31, 2020 Assets Current assets Cash Accounts receivable Supplies Property, Plant and Equipment Equipment Total Asset Liabilities and Equity Liabilities Accounts payable Equity Ali Omar, Capital Total liabilities and equity Statement of Retained earnings For the month ended March 31, 2020 Ali Omar, Beginning capital $ 19,3 add: Net income/ (loss) $ 900 Ali Omar, Ending capital $ 20,200 $ 15,000 $ 22,550 $ 2,350 $ 20,200 $ 22,550 The profit $ 900 is not a cash profit, out of service revenue of $ 1,150, only $ 600 received in cash. and balance of $ 550 yet to receive. Expense on advertisement paid for $ 250, it is real cash outflow. Effectively cash inflow from operating activities is $ 350 (600-250]