Question

The following financial statements were prepared at the end of the month of May: TOPS IN...

The following financial statements were prepared at the end of the month of May:



TOPS IN TOPIARY - INCOME STATEMENT FOR the month of May

Revenue $2,540
Expenses:
Rent Expense $500
Advertising Expense $500
Wages Expense $200 $1,200
Net Income $1,340



TOPS IN TOPIARY - STATEMENT OF OWNER'S EQUITY FOR the month of MAY

Owner's Equity at May 1 $0
plus: Investment 2,000
plus: Net Income 1,340
less: Withdrawals 0
Owner's Equity at May 31 $3,340



TOPS IN TOPIARY - BALANCE SHEET AS OF MAY 31

ASSETS LIABILITES AND OWNER'S EQUITY
Current Assets: Current Liabilities:
Cash $1,380 Accounts Payable $300
Accounts Receivable $1,500 Advertising Payable $500
Prepaid Rent $ 500 Advances from Customers $200
Prepaid Advertising $ 500
Supplies $ 100 $3,980
Equipment $ 360 Owner's Equity $3,340
Total Assets $4,340 Total Liabilities & OE $4,340



During June the following transactions occurred:

1) Paid the helper the $1,000 owed from works done in May (the amount owed is in Accounts Payable).

2) Completed the job for which the customer paid $200 in May. Tops in Topiary collected $2000 in cash once finished.

3) Paid $500 for the rent of July.

4) At the end of June notices that there are no supplies left. Makes a note to buy some in July.

5) At the end of June notices that there are few flyers left (used for advertising) worth $200 and decides to order some for July. Before ordering, the printer (supplier of flyers) asks to be paid $600 of the amount owed for the flyers done in May. Tops in Topiary pays $600.

6) In June collected in cash $3,000 for 3 jobs are done for a total of $4,500, the rest is owed in account by the customers.

7) In June decided to start depreciating the equipment bought for $360 that is expected to last for 3 years.

8) In June 23rd Edward Scissorhands withdrew some cash for personal reasons ($2,000).

Prepare "T" Accounts in ACCRUAL Basis for the period ended on June 30th and then answer the questions.

Question 1: At the end of the accounting period (June 30th, T account after AJE), what is the total of Assets?

A. Between $2,000 and $2,999

B. More than $5,500

C. Between $4,500 and $5,500

D. Between $3,000 and $4,499

E. Less than $2,000

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