On October 1 2009 World Services Inc wa s started On October

On October 1, 2009, World Services, Inc. wa s started. On October 31, the accounting records contained the following amounts: Accounts payable Cash Contributed capital $ 500 1,500 2,000 S 100 Office supplies s receivable 3,900 Rent expense 25,000 Salaries expense 50,000 Supplies expense stces earned 10,500 Telephone expense Dividends declared 200 Office equipment 2,100 24,100 The following transactions occurred during the month of November a. b. c. d. Paid rent expense for $500 using cash. Paid salaries expense for $300 using cash Paid supplies expense for $50 on account. Almost made a sale to the ABC Company. Record each transaction to the appropriate T account. Prepare an income statement for the month ended November 30, 2009. Remember to post your beginning balances in your T accounts. Show T account balances to support the amounts in your Income Statement

Solution

Cash Rent expense Particulars Amount Particulars Amount Particulars Amount Particulars Amount To balances 25000 To balance 1500 by rent Expenses 500 To Cash 500 By Salaries expenses 300 By Supplies Expenses 50 By balance 2000 Total 2000 Total 2000 By Balance 24150 Total 25000 Total 25000 Salaries expense Supplies Expense Particulars Amount Particulars Amount Particulars Amount Particulars Amount To balance 2000 To balance 100 To Cash 300 To Cash 50 By balance 2300 By balance 150 Total 2300 Total 2300 Total 150 Total 150 World Services Inc Income Statement For the month ended november 30, 2009 Amount in $ Revenues Consuting fee earned 10500 Expenses Rent Expenses 2000 Salaries expenses 2300 Supplies expenses 150 Telephone Expenses 200 4650 Net income 5850