Homework Sourseincrease by 8540 and the liabilities increase by Compute th
increase by $8,540, and the liabilities increase by ). Compute the resulting accounting equation. 3. During February, the assets decrease by $3,460, and the liabilities increase by $2,000. Compute the resulting accounting equation. P2-9A (L03/4) / Total cash following(g): $12,950 EFFECT OF TRANSACTIONS ON ACCOUNTING E started a business. During the first month occurred. QUATION Jay Pembroke cions CLGL (a) Invested cash in business, $18,000. (b) Bought office supplies for $4,600: $2,000 in cash and $2,600 on account. (c) Paid one-year insurance premium, $1,200. d) Eamed revenues totaling $3,300: $1,300 in cash and $2,000 on account (e) Paid cash on account to the company that supplied the office supplies in transaction (b), $2,300. (f) Paid office rent for the month, $7s0. (g) Withdrew cash for personal use, $100. REQUIRED Show the effect of each transaction on the individual accounts of the expanded a ing equation: Assets Liabilities+ Owner\'s Equity (Capital - Drawing+ Revenues Expenses). After transaction (g), report the totals for each element. Demonstrate that the accounting equation has remained in baiance ccount P2-10A (LOs) Net incomes INCOME STATEMENT Based on Problem 2-9A, prepare a. income statement fo Jay Pembroke for the month of April 20- CLGL 
Solution
Answer 2-11A. Statement of Owners\' Equity For the Month of April 20-- Beginning Balance - Investment 18,000.00 Net Income 2,550.00 Sub-total 20,550.00 Withdrawl (100.00) Ending Balance, April 20 20,450.00 Answer 2-12A. Balance Sheet As of April 20-- Assets Current Assets Cash 12,950.00 Accounts Receivable 2,000.00 Office Supplies 4,600.00 Prepaid Insurance 1,200.00 Total Current Assets 20,750.00 Property, Plant & Equipment - Total Assets 20,750.00 Liabilities & Owners\' Equity Liabilities Current Liabilities Accounts Payable 300.00 Long-Term Liabilities - Total Liabilities 300.00 Owners\' Equity Jay Pembroke, Capital 20,450.00 Total Liabilities & Owners\' Equity 20,750.00