Set Up T Accounts for Cash; Accounts Receivable; Supplies; Accounts

question 42

Essay

Set up T accounts for Cash; Accounts Receivable; Supplies; Accounts Payable; Common Stock; Dividends; Professional Fees; and Operating Expenses.(a)In the T accounts, record the following transactions of Potter Pool Services for June, identifying each entry by number:
(1)Stockholders invested $12,500 cash in the business by purchasing common stock.(2)Purchased supplies on account, $6,250.(3)Paid operating expenses, $5,500.(4)Billed clients for fees, $7,440.(5)Received cash from cash clients, $4,700.(6)Paid creditors on account, $1,400.(7)Received $3,100 from clients on account.(8)Paid $1,500 cash dividends.(b)Prepare a trial balance as of June 30 for Potter Pool Services.(c)Assuming that supplies expense (which has not been recorded) amounts to $1,500 for June, determine the following:
(1)Net income for the month.(2)Stockholders' equity as of June 30.​

---

Definitions:

Cost-effectiveness Evaluation

An assessment technique used to determine the best method of achieving a specific outcome with the least amount of resources, commonly applied in health economics and public policy.

Scrap

In a business context, scrap refers to waste material or unwanted items resulting from manufacturing processes, often recycled or discarded.

Return on Investment

A performance measure used to evaluate the efficiency of an investment or compare the efficiency of a number of different investments.

Gross Benefit

Gross benefit refers to the total positive outcomes or advantages gained from an activity or investment before subtracting any costs.