1 Arrange the following asset liability and equity titels in

1. Arrange the following asset, liability, and equity titels in a table. Cash: accounts receivable; office supplies, office equiptment: roofing equipment; accounts payable; r.rivers capital; r river withdrawl; revenues; and expenses

2. Use additional and subtractions to show the effects of each transaction on the accounts in the accouting equation. Show ner balances after each transaction

3. Use the increases and decreases in the columns of the table from part 2 to prepare an incomes statement, a statement of owner\'s equity, and a statement of cash flows - each of these for the current month. Also prepare a balance sheet as of the end of the month.

4. Assume that $5,000 purchase of roofing equipment on July 3 was financed from an owner investment of another $5,000 cash in the business (Instead of the purchase conditions descried in the transaction). explain the effect of this change on total assets, total liabilities, and total equity.

Rivera Roofing Company, owned by Reyna Rivera, began operations in July and completed these transactions during that first month of operations.

July 1 Reyna Rivera invested $80,000 cash in the company.
2 The company rented office space and paid $700 cash for the July rent.
3 The company purchased roofing equipment for $5,000 by paying $1,000 cash and agreeing to pay the $4,000 balance in 30 days.
6 The company purchased office supplies for $600 cash. 8 The company completed work for a customer and immediately collected $7,600 cash for the work.
10 The company purchased $2,300 of office equipment on credit.
15 The company completed work for a customer on credit in the amount of $8,200.
17 The company purchased $3,100 of office supplies on credit.
23 The company paid $2,300 cash for the office equipment purchased on July 10.
25 The company billed a customer $5,000 for work completed; the balance is due in 30 days.
28 The company received $8,200 cash for the work completed on July 15.
30 The company paid an assistant’s salary of $1,560 cash for this month.
31 The company paid $295 cash for this month’s utility bill. 31 Reyna Rivera withdrew $1,800 cash from the company for personal use.

Solution

Balance Sheet Event Assets Liabilities Equity Cash + Accounts receivable + Office supplies + Office equipment + roofing equipment = Accounts payable + River capital - River withdrawl + Revenue - Expenses July 1 80000 80000 July 2 -700 700 July 3 5000 5000 July 3 -5000 5000 July 6 -600 600 July 10 2300 2300 July 15 8200 8200 July 17 3100 3100 July 23 -2300 -2300 July 25 5000 5000 July 28 8200 -8200 July 30 -1560 1560 July 31 -295 295 July 31 -1800 1800 Total 80945 5000 3700 2300 5000 3100 85000 1800 13200 2555 Income statement Sales revenue 13200 Rent expense 700 Salaries expense 1560 Utility expenses 295 Total expenses 2555 Net income 10645 Statement of owners equity Investment 80000 Cash investment 5000 Net income 10645 Withdrawl -1800 Closing balance 93845 Cash received from customers          8,200 Cash paid to suppliers and employees         -3,155 Cash flow from operations          5,045 Cash paid for office equipment         -2,300 Cash paid for roofing equipment         -5,000 Net cash used in investing activities         -7,300 Cash contribution from proprietor        85,000 Cash withdrawl by proprietor         -1,800 Net cash used in financing activities        83,200 Net change in cash        80,945 Opening cash balance                 -   Closing cash balance        80,945