yesenia and LeAnn decide to earn extra money by starting a painting business. They plan to open the business in May and then start with painting jobs in June. The following activities occurred in June: 1. They complete three painting jobs during the month: a. Job 1: They complete this job on June 11 and are paid $1,350 in cash—with $150 originally received in May (see Assignment 1, #6). For this job they use $450 worth of paint. b. Job 2: They complete the job on June 19, receive $1,100 in cash, and use $500 worth of paint. c. Job 3: They complete the job on June 30. The customer agrees to pay the total amount ($1,700) on July 3. They use $650 worth of paint. 2. Additionally, they sign two contracts in June for jobs to be started in July: a. Job 4: The quoted price is $2,200. The customer will make a 10% down payment when the work begins. b. Job 5: The quoted price is $400. The customer pays half this amount when the contract is signed on June 25. The other half will be paid when the work is complete. 3. They pay their bill for paint purchased in May (see Assignment 1, #7). 4. They purchase $1,700 in paint, all on account. 5. They use $120 worth of supplies for painting jobs in June. 6. They purchase an additional $160 in supplies in cash. 7. They hire Jasper, a friend, to help with the Job 3. Jasper will be paid $200 once the customer pays on July 3. Notes: The van is expected to last four years. The ladders are expected to last two years. The tax rate on positive pretax income is 30%. Taxes won’t be paid until April of next year. Assume any necessary adjusting entries are made at the end of each month. Required: a. Show journal entries for each transaction that needs to be recorded in June (you do not need to record journal entries which occur outside of June). b. Complete t-accounts for the transactions. c. Construct an income statement for June. Note: Please use the solution to Assignment 1 for account names and other details (i.e., adjustments) necessary for June. Remember that t-account balances carr
