The following events apply to Montgomery Company for Year 1, its first year of operation:. 1. Received cash of $36,000 from the issue of common stock.
2. Performed $48,000 of services on account.
3. Incurred $6,500 of other operating expenses on account.
4. Paid $21,000 cash for salaries expense.
5. Collected $34,500 of accounts receivable.
6. Paid a $3,000 dividend to the stockholders.
7. Performed $9,500 of services for cash.
8. Paid $5,500 of the accounts payable.
Required:
a. Record the preceding transactions in general journal form.
b. Post the entries to T-accounts and determine the ending balance in each account
c. & d. Determine the amount of total assets at the end of Year 1, and the amount of net income for Year 1.