Question

Make balance sheet

1.sold all the stock for 5000 and receive a cheque
2. a trade receivable paid 600 by cheque
3. the owner took 800 from the bank for personal use
4. withdrew 2000 from the bank for business expenses​

Answer 1

Balance Sheet as at year end

ASSETS

Cash (5000 + 600 - 800 - 2000) $2,800

Trade Receivable ( -600) ($600)

TOTAL ASSETS $2,200

EQUITY AND LIABILITIES

EQUITY

Retained Earnings (5000 -800 - 2000) $2,200

TOTAL EQUITY $2,200

LIABILITIES

Liabilities $0

TOTAL LIABILITIES $0

TOTAL EQUITY AND LIABILITIES $2,200

Step-by-step explanation:

The Balance sheet contains balances of Assets, Liabilities and Equity as at the Reporting date.

So given the above transactions above, we have to identify which accounts (Assets, Liabilities or Equity) are affected by each transaction, than record under the relevant heading as shown in the solution.