Problem

Using the accounting equation for transaction analysis [15-25 min]Matilda Crone owns and o...

Using the accounting equation for transaction analysis [15-25 min]

Matilda Crone owns and operates a public relations firm called Dance Fever, Inc. The following amounts summarize her business on August 31, 2012:

Assets							=	Liabilities	+	Stockholders’ equity
Date	Cash	+	Accounts receivable +	Supplies	+	Land	=	Accounts payable	+	Common stock +	Retained earnings
Bal	2,300		1,800	0		14,000		8,000		3,000	7,100

During September 2012, the business completed the following transactions:

a. Issued common stock 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 issued common stock.
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. Paid cash dividends 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.
Analysis of Transactions, Smart Touch Learning, Inc.