Question

Sandhill Inc.'s general ledger at April 30, 2021, included the following: Cash $5,600; Supplies $500, Equipment $20,000: Accounts Payable $2,100; Deferred Revenue (from gift certificates) $1,300; Bank Loan Payable $10,000: Common Shares $5,000, and Retained Earnings $7.700. The following transactions occurred during May:

May
1 Paid rent for the month of May. $1,300.
4 Paid $1,600 of the account payable outstanding at April 30.
7 Issued gift certificates for future services for $1,900 cash.
15 Received $2.500 from customers for services performed to date.
15 Paid $1,200 in salaries to employees.
17 Customers receiving services worth $700 used gift certificates in payment.
18 Paid the remaining accounts payable from April 30.
22 22 Purchased supplies of $700 on account.
24 Received a bill for advertising for $500. This bill is due on June 22.
25 Received and paid a utilities bill for $400.
28 Received $2,100 from customers for services performed.
29 Customers receiving services worth $600 used gift certificates in payment.
30 Interest of $50 was paid on the bank loan. 30 Interest of $50 was paid on the bank loan.
31 Paid $1,200 in salaries to employees.
31 Paid income tax instalment for the month, $150.

Answer 1

In May, Sandhill Inc. had several transactions that affected their financial position. These transactions included paying rent, receiving payments for services, issuing gift certificates, and more. To analyze and record these changes, updates need to be made to the company's general ledger.

Step-by-step explanation:

In May, Sandhill Inc. had several transactions. Here is a breakdown of the transactions:

1. Paid rent for the month of May: $1,300.
2. Paid $1,600 of the accounts payable outstanding at April 30.
3. Issued gift certificates for future services for $1,900 cash.
4. Received $2,500 from customers for services performed to date.
5. Paid $1,200 in salaries to employees.
6. Customers receiving services worth $700 used gift certificates in payment.
7. Paid the remaining accounts payable from April 30.
8. Purchased supplies of $700 on account.
9. Received a bill for advertising for $500, due on June 22.
10. Received and paid a utilities bill for $400.
11. Received $2,100 from customers for services performed.
12. Customers receiving services worth $600 used gift certificates in payment.
13. Paid interest of $50 on the bank loan.
14. Paid income tax installment for the month: $150.

To analyze the effect of these transactions on the company's financial position, we need to record the changes to the general ledger. This will include updating the cash, accounts payable, deferred revenue, and other accounts accordingly.