Neveranerror Inc. 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.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.June 8:Signed a two-year promissory note 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.June 17:Paid a $900 bill from the local newspaper for advertising for the month of June.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. The total amount is $2,700.June 29:Received the landlord’s bill for $2,200 for rent on the office space that Neveranerror leases. The bill is payable by the 10th of the following month.June 30:Paid salaries and wages for June. 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.

Required:

1. Complete the below table to summarize the preceding transactions as they affect the accounting equation. Ignore depreciation expense and interest expense. If an account is unaffected by a transaction, enter “0”. Use the minus sign to indicate decreases.

Neveranerror Inc.

Transactions for the Month of JuneAssets=Liabilities+Stockholders’ EquityDate Cash Accounts Receivable Computer Rent PayableAccounts PayableNotes Payable Capital StockRetained EarningsJune 2$ $ $ $ $ $ $ $ June 5 Bal.$ $ $ $ $ $ $ $ June 8 Bal.$ $ $ $ $ $ $ $ June 15 Bal.$ $ $ $ $ $ $ $ June 17 Bal.$ $ $ $ $ $ $ $ June 23 Bal.$ $ $ $ $ $ $ $ June 28 Bal.$ $ $ $ $ $ $ $ June 29 Bal.$ $ $ $ $ $ $ $ June 30-Wages Bal.$ $ $ $ $ $ $ $ June 30-Billed clients Bal.$ $ $ $ $ $ $ $ June 30-Dividends Bal.$ $ $ $ $ $ $ $ Total Assets$ Total Liabilities and Stockholders’ Equity $

 

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