The following transactionsoccurred during July:
1. Received $1,200 cash for servicesperformed during July. 2. Received $6,400 cash from theissuance of common stock to owners. 3. Received $600 from a customer aspayment for services performed during June. 4. Billed $4,100 to customers forservices performed on account in July. 5. Borrowed $2,900 from the bankand signed a promissory note. 6. Received $1,600 from a customerfor services to be performed during August.
What is the amount of revenue that will be reported on theincome statement for the month ended July 31?
| The following transactionsoccurred during July: |
| 1. | Received $1,200 cash for servicesperformed during July. |
| 2. | Received $6,400 cash from theissuance of common stock to owners. |
| 3. | Received $600 from a customer aspayment for services performed during June. |
| 4. | Billed $4,100 to customers forservices performed on account in July. |
| 5. | Borrowed $2,900 from the bankand signed a promissory note. |
| 6. | Received $1,600 from a customerfor services to be performed during August. |
What is the amount of revenue that will be reported on theincome statement for the month ended July 31? |
Related questions
At June 30, 2017, the end of its most recent fiscal year, Primrose Comp Consultantsâ post-closing trial balance was as follows:
| Debit | Credit | |||
| Cash | $5,860 | |||
| Accounts receivable | 1,340 | |||
| Supplies | 770 | |||
| Accounts payable | $450 | |||
| Unearned service revenue | 1,250 | |||
| Common stock | 4,000 | |||
| Retained earnings | 2,270 | |||
| $7,970 | $7,970 |
The company underwent a major expansion in July. New staff was hired and more financing was obtained. Culver conducted the following transactions during July 2017, and adjusts its accounts monthly.
| July | 1 | Purchased equipment, paying $4,000 cash and signing a 2-year note payable for $22,400. The equipment has a 4-year useful life. The note has a 6% interest rate which is payable on the first day of each following month. | |
| 2 | Issued 22,400 shares of common stock for $56,000 cash. | ||
| 3 | Paid $4,200 cash for a 12-month insurance policy effective July 1. | ||
| 3 | Paid the first 2 (July and August 2017) monthsâ rent for an annual lease of office space for $4,500 per month. | ||
| 6 | Paid $4,300 for supplies. | ||
| 9 | Visited client offices and agreed on the terms of a consulting project. Culver will bill the client, Connor Productions, on the 20th of each month for services performed. | ||
| 10 | Collected $1,340 cash on account from Milani Brothers. This client was billed in June when Culver performed the service. | ||
| 13 | Performed services for Fitzgerald Enterprises. This client paid $1,250 in advance last month. All services relating to this payment are now completed. | ||
| 14 | Paid $450 cash for a utility bill. This related to June utilities that were accrued at the end of June. | ||
| 16 | Met with a new client, Thunder Bay Technologies. Received $13,400 cash in advance for future services to be performed. | ||
| 18 | Paid semi-monthly salaries for $12,300. | ||
| 20 | Performed services worth $31,400 on account and billed customers. | ||
| 20 | Received a bill for $2,500 for advertising services received during July. The amount is not due until August 15. | ||
| 23 | Performed the first phase of the project for Thunder Bay Technologies. Recognized $11,200 of revenue from the cash advance received July 16. | ||
| 27 | Received $16,800 cash from customers billed on July 20. |
Adjustment data:
| 1. | Adjustment of prepaid insurance. | |
| 2. | Adjustment of prepaid rent. | |
| 3. | Supplies used, $1,400. | |
| 4. | Equipment depreciation, $550 per month. | |
| 5. | Accrual of interest on note payable. | |
| 6. | Salaries for the second half of July, $12,300, to be paid on August 1. | |
| 7. | Estimated utilities expense for July, $900 (invoice will be received in August). | |
| 8. | Income tax for July, $1,340, will be paid in August |
*Journalize July Transactions**
Morrison Accounting Services was organized on June 2 by a group of accountants to provide accounting and tax services to small businesses. The following transactions occurred during the first month of business:
| June 2 | Received contributions of $10,000 from each of the three owners of the business in exchange for shares of stock. (Capital Stock) |
| June 5 | Purchased a computer system for $12,000. The agreement with the vendor requires a down payment of $2,500 with the balance due in 60 days. (Computer; Cash; Accounts Payable) |
| June 8 | Signed a two-year promissory note (Note Payable) at the bank and received cash of $20,000. |
| June 15 | Billed $12,350 to clients for the first half of June. Clients are billed twice a month for services performed during the month, and the bills are payable within ten days. (Accounts Receivable; Service Revenue) |
| June 17 | Paid a $900 bill from the local newspaper for advertising for the month of June. (Advertising Expense) |
| June 23 | Received the amounts billed to clients for services performed during the first half of the month. |
| June 28 | Received and paid gas, electric, and water bills (Utilities Expense). The total amount is $2,700. |
| June 29 | Received the landlordâs bill for $2,200 for rent on the office space the Morrison leases. The bill is payable by the 10th of the following month. (Rent Expense; Rent Payable) |
| June 30 | Paid salaries and wages for June. (Salaries Expense) The total amount is $5,670. |
| June 30 | Billed $18,400 to clients for the second half of June. |
| June 30 | Declared and paid dividends in the amount of $6,000. (Dividends) |
Prepare journal entries on the books of Morrison Accounting Services to record the transactions entered into during the month. Ignore depreciation expense and interest expense (weâll get to that later in the semester.)
Prepare a trial balance in good form at June 30. List the accounts in the following order: assets, liabilities, ownersâ equity, revenue, expenses, dividends. (You will find it helpful to set-up and post to T-accounts; the T-accounts are not required to be turned in for grading.)
Prepare the following financial statements in good form:
Income statement for the month of June
Statement of retained earnings for the month of June
Classified balance sheet at June 30.
