Show effect of previous transactions on accounting equation

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Reference no: EM132572346

Mr. X started her own consulting firm, "X" Consulting, on May 1, 2020. The following transactions occurred during the month of May. May

1 Mr X invested $20,000 cash in the business.

2 Purchased Equipment $1000 on credit for the month.

3 Purchased $500 of supplies on account.

5 Paid $225 to advertise in the Mounty News.

9 Received $6,000 cash for services provided.

12 Drawings $1,000 cash for personal use.

15 Performed $7,400 of services on account.

17 Paid $2,500 for employee salaries.

20 Paid for the supplies purchased on account on May 3.

23 Received a cash payment of $5,000 for services provided on account on May 15.

26 Borrowed $5,000 from the bank on a note payable.

29 Purchased office equipment for $5,200 in cash.

30 Paid $500 for utilities.

Instructions

Question (a) Show the effects of the previous transactions on the accounting equation.

Question (b) Prepare an Owner Equity Statement for the month of May.

Reference no: EM132572346

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