Nancy O'Rode,doing business as O'Rode Consulting,performs consulting services for companies that create online learning games for children.On January 1,2018,she started a sole proprietorship by placing $15,000 cash in a bank account opened for the business.Each month during the year,O'Rode withdrew $500 cash from the business for personal use.At December 31,2018,after the last withdrawal,the Drawings account reflected a debit balance of $6,000.During the year,the usual journal entries for the year,including adjusting and closing entries for the revenue and expense accounts,resulted in total revenue of $60,000,total expenses of $12,000,and net income of $48,000.(For purposes of the related journal entry,use the accounts "Consulting Revenue" and "Operating Expenses.")
Part a. Prepare the journal entry to record the initial capital contribution.
Part b. Prepare the journal entry to record one of the monthly withdrawals.
Part c. Prepare the journal entry to close the net income to the N. O'Rode, Capital account.
Part d. Prepare the journal entry to close the N. O'Rode, Drawings accounts at the end of the year.
Part e. Prepare a Statement of Owner's Equity for the year ending December 31, 2018.

Question

Nancy O'Rode,doing business as O'Rode Consulting,performs consulting services for companies that create online learning games for children.On January 1,2018,she started a sole proprietorship by placing $15,000 cash in a bank account opened for the business.Each month during the year,O'Rode withdrew $500 cash from the business for personal use.At December 31,2018,after the last withdrawal,the Drawings account reflected a debit balance of $6,000.During the year,the usual journal entries for the year,including adjusting and closing entries for the revenue and expense accounts,resulted in total revenue of $60,000,total expenses of $12,000,and net income of $48,000.(For purposes of the related journal entry,use the accounts "Consulting Revenue" and "Operating Expenses.")
Part a.	Prepare the journal entry to record the initial capital contribution.
Part b.	Prepare the journal entry to record one of the monthly withdrawals.
Part c.	Prepare the journal entry to close the net income to the N. O'Rode, Capital account.
Part d.	Prepare the journal entry to close the N. O'Rode, Drawings accounts at the end of the year.
Part e.	Prepare a Statement of Owner's Equity for the year ending December 31, 2018.

Quizplus · Accepted Answer

The Answer of Nancy O'Rode,doing business as O'Rode Consulting,performs consulting services for companies that create online learning games for children.On January 1,2018,she started a sole proprietorship by placing $15,000 cash in a bank account opened for the business.Each month during the year,O'Rode withdrew $500 cash from the business for personal use.At December 31,2018,after the last withdrawal,the Drawings account reflected a debit balance of $6,000.During the year,the usual journal entries for the year,including adjusting and closing entries for the revenue and expense accounts,resulted in total revenue of $60,000,total expenses of $12,000,and net income of $48,000.(For purposes of the related journal entry,use the accounts "Consulting Revenue" and "Operating Expenses.")
Part a.	Prepare the journal entry to record the initial capital contribution.
Part b.	Prepare the journal entry to record one of the monthly withdrawals.
Part c.	Prepare the journal entry to close the net income to the N. O'Rode, Capital account.
Part d.	Prepare the journal entry to close the N. O'Rode, Drawings accounts at the end of the year.
Part e.	Prepare a Statement of Owner's Equity for the year ending December 31, 2018.

Nancy O'Rode,doing Business as O'Rode Consulting,performs Consulting Services for Companies