Chapter 1, Problem 1.40AP

Using the accounting equation for transaction analysis

Missy Mansion opened a public relations firm called Solid Gold on August 1, 2016. The following amounts summarize her business on August 31, 2016:

During September 2016, the business completed the following transactions:

1. a. Missy Mansion contributed $8,000 cash in exchange for common stock.
2. b. Performed service for a client and received cash of $1,300.
3. c. Paid off the beginning balance of accounts payable.
4. d. Purchased office supplies from OfficeMax on account, $400.
5. e. Collected cash from a customer on account, $2,200.
6. f. Cash dividends of $1,800 were paid to stockholders.
7. g. Consulted for a new band and billed the client for services rendered, $6,500.
8. h. Recorded the following business expenses for the month:

Paid office rent: $1,400.

Paid advertising: $350.

Analyze the effects of the transactions on the accounting equation of Solid Gold using the format presented on page 43.