Using the accounting equation for transaction analysis
Matilda Crone owns and operates a public relations firm called Dance Fever. The following amounts summarize her business on August 31, 2012:
|
Assets |
= Liabilities |
+ Owner”s equity |
||||
|
Date |
Cash |
+ Accounts receiveable |
+ Supplies |
+ Land |
=Accounts payable |
+ Crone,capital |
|
Bal |
2,300 |
1,800 |
0 |
14,000 |
8,000 |
10,100 |
During September 2012, the business completed the following transactions:
a. Gave capital to Crone and received cash of $13,000.
b. Performed service for a client and received cash of $900.
c. Paid off the beginning balance of accounts payable.
d. Purchased supplies from OfficeMax on account, $600.
e. Collected cash from a customer on account, $700.
f. Received cash of $1,600 and gave capital to owner.
g. Consulted for a new band and billed the client for services rendered, $5,500.
h. Recorded the following business expenses for the month:
1. Paid office rent, $1,200.
2. Paid advertising, $600.
i. Returned supplies to OfficeMax for $110 from item d, which was the cost of the supplies.
j. Crone withdrew cash of $2,000.
Requirement
1. Analyze the effects of the preceding transactions on the accounting equation of
Dance Fever. Adapt the format to that of Exhibit 1-6.