Topic:

1. Mark Zukarbarg
ID:

2. Nikson
ID:

3. Addams
ID:

4. Paul
ID:

5. Newton
ID:
1. How to collect data from practical field
2. How to convert raw data to Transactions
3. How to convert transactions to Accounting Equation
4. How to convert Accounting Equation to Financial
Statements according to IAS 1 and BAS 1
 Accounting Equation

Barone’s Repair Shop was started on May 1 by Nancy. Prepare a tabular

analysis of the following transactions for the month of May.

1. Invested $10,000 cash to start the repair shop.

Assets Liabilities Equity

Accounts Accounts Barone,
Cash + Receivable + Equipment = Payable + Capital
1. +10,000 +10,000 Investment
 Accounting Equation
2. Purchased equipment for $5,000 cash.

Assets Liabilities Equity

Accounts Accounts Barone,
Cash + Receivable + Equipment = Payable + Capital
1. +10,000 +10,000 Investment
2. -5,000 +5,000
 Accounting Equation
3. Paid $400 cash for May office rent.

Assets Liabilities Equity

Accounts Accounts Barone,
Cash + Receivable + Equipment = Payable + Capital
1. +10,000 +10,000 Investment
2. -5,000 +5,000
3. -400 -400 Expense
 Accounting Equation
4. Received $5,100 from customers for repair service.

Assets Liabilities Equity

Accounts Accounts Barone,
Cash + Receivable + Equipment = Payable + Capital
1. +10,000 +10,000 Investment
2. -5,000 +5,000
3. -400 -400 Expense
4. +5,100 +5,100 Revenue
 Accounting Equation
5. Withdrew $1,000 cash for personal use.

Assets Liabilities Equity

Accounts Accounts Barone,
Cash + Receivable + Equipment = Payable + Capital
1. +10,000 +10,000 Investment
2. -5,000 +5,000
3. -400 -400 Expense
4. +5,100 +5,100 Revenue
5. -1,000 -1,000 Drawings
 Accounting Equation
6. Paid part-time employee salaries of $2,000.

Assets Liabilities Equity

Accounts Accounts Barone,
Cash + Receivable + Equipment = Payable + Capital
1. +10,000 +10,000 Investment
2. -5,000 +5,000
3. -400 -400 Expense
4. +5,100 +5,100 Revenue
5. -1,000 -1,000 Drawings
6. -2,000 -2,000 Expense
 Accounting Equation
7. Incurred $250 of advertising costs, on account.

Assets Liabilities Equity

Accounts Accounts Barone,
Cash + Receivable + Equipment = Payable + Capital
1. +10,000 +10,000 Investment
2. -5,000 +5,000
3. -400 -400 Expense
4. +5,100 +5,100 Revenue
5. -1,000 -1,000 Drawings
6. -2,000 -2,000 Expense
7. +250 -250 Expense
 Accounting Equation
8. Provided $750 of repair services on account.

Assets Liabilities Equity

Accounts Accounts Barone,
Cash + Receivable + Equipment = Payable + Capital
1. +10,000 +10,000 Investment
2. -5,000 +5,000
3. -400 -400 Expense
4. +5,100 +5,100 Revenue
5. -1,000 -1,000 Drawings
6. -2,000 -2,000 Expense
7. +250 -250 Expense
8. +750 +750 Revenue
 Accounting Equation
9. Collected $120 cash for services previously billed.

Assets Liabilities Equity

Accounts Accounts Barone,
Cash + Receivable + Equipment = Payable + Capital
1. +10,000 +10,000 Investment
2. -5,000 +5,000
3. -400 -400 Expense
4. +5,100 +5,100 Revenue
5. -1,000 -1,000 Drawings
6. -2,000 -2,000 Expense
7. +250 -250 Expense
8. +750 +750 Revenue
9. +120 -120
6,820 + 630 + 5,000 = 250 + 12,200
 Financial Statements

Companies prepare four financial statements from the summarized

accounting data:

Owner’s Statement
Income Balance
Equity of
Statement
Statement Sheet Cash Flows
Financial Statements
Income Statement

Barone’s Repair Shop

Income Statement
For the Month Ended May 31, 2008

Revenues:
Service revenue $ 5,850
Expenses:
Salary expense 2,000
Rent expense 400
Advertising expense 250
Total expenses 2,650
Net income $ 3,200
 Financial Statements
Owner’s Equity
Income Statement Statement
Barone’s Repair Shop Barone’s Repair Shop
Income Statement Owner's Equity Statement
For the Month Ended May 31, 2008 For the Month Ended May 31, 2008

Revenues: Barone's, Capital May 1 $ -

Service revenue $ 5,850 Add: Investment 10,000
Expenses: Net income 3,200
Salary expense 2,000 13,200
Rent expense 400 Less: Drawings 1,000
Advertising expense 250
Barone's, Capital May 31 $12,200
Total expenses 2,650
Net income $ 3,200
 Financial Statements
Owner’s Equity Statement

Barone’s Repair Shop

Owner's Equity Statement
For the Month Ended May 31, 2008

Barone's, Capital May 1 $ -

Add: Investment 10,000
Net income 3,200
13,200
Less: Drawings 1,000
Barone's, Capital May 31 $12,200
 Financial Statements
Owners’ Equity
Balance Sheet Statement
Barone’s Repair Shop
Barone’s Repair Shop
Balance Sheet
Owner's Equity Statement
May 31, 2008
For the Month Ended May 31, 2008
Assets
Cash $ 6,820 Barone's, Capital May 1 $ -
Accounts receivable 630 Add: Investment 10,000
Equipment 5,000 Net income 3,200
Total assets $12,450 13,200
Liabilities Less: Drawings 1,000
Accounts payable $ 250 Barone's, Capital May 31 $ 12,200
Owner's Equity
Barone's, capital 12,200
Total liab. & equity $12,450
Financial Statements
Balance Sheet

Barone’s Repair Shop

Balance Sheet
May 31, 2008
Assets
Cash $ 6,820
Accounts receivable 630
Equipment 5,000
Total assets $12,450
Liabilities
Accounts payable $ 250
Owner's Equity
Barone's, capital 12,200
Total liab. & equity $12,450
 Financial Statements

Statement of Cash Flows

Balance Sheet
Barone’s Repair Shop
Statement of Cash Flows
Barone’s Repair Shop
For the Month Ended May 31, 2008
Balance Sheet
Cash flow from operating activities
May 31, 2008
Cash receipts from revenues $ 5,220
Assets
Cash paid for expenses (2,400)
Cash $ 6,820 Cash provided by operations 2,820
Accounts receivable 630 Cash flow from investing activitites
Equipment 5,000 Purchase of equipment (5,000)
Total assets $12,450 Cash flow from financing activities
Liabilities Investment by owners 10,000
Accounts payable $ 250 Drawings by owners (1,000)
Owner's Equity Cash provided by financing 9,000
Barone's, capital 12,200 Net increase in cash 6,820
Total liab. & equity $12,450 Cash balance, May 1 -
Cash balance, May 31 $ 6,820
 Financial Statements
Statement of Cash Flows
Barone’s Repair Shop
Statement of Cash Flows
For the Month Ended May 31, 2008
Cash flow from operating activities
Cash receipts from customers $ 5,220
Cash paid for expenses (2,400)
Cash provided by operations 2,820
Cash flow from investing activities
Purchase of equipment (5,000)
Cash flow from financing activities
Investment by owners 10,000
Drawings by owners (1,000)
Cash provided by financing 9,000
Net increase in cash 6,820
Cash balance, May 1 -
Cash balance, May 31 $ 6,820