Transaction analysis and the calculation of net income (Learning Objective 5) 20–25 min.

Jill Stevens worked as an accountant at a local accounting firm for five years after graduating from college. Recently, she opened her own accounting practice, which she operates as a corporation. The name of the new entity is Stevens and Associates, Inc.

Jill experienced the following events during the first month of operations. Some of the events were personal and did not affect the accounting practice. Others were business transactions and should be accounted for by the business.

Requirements 1. Enter each transaction in the expanded accounting equation of Stevens and Associates, Inc., as needed, calculating new balances after each transaction.
2. Determine the following items:

a. Total assets

b. Total liabilities

c. Total stockholders’ equity

d. Net income or net loss for April.AppendixLO1

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Apr 3 Received $65,000 cash proceeds from refinancing her house. 5 7 9 $50,000 of common stock in the business was sold to Jill Stevens. The cash proceeds were deposited in a new business bank account titled Stevens and Associates, Inc. Paid $600 cash for office supplies for the new accounting practice. Purchased $4,300 of office furniture for the accounting practice and agreed to pay the vendor within three months. 10 Jill sold 1,200 shares of Ford stock, which she had owned for several years, receiving $15,600 cash. The cash from the sale of stock was deposited in her personal bank account. 14 A representative of a large company telephoned Jill and told her of the company's intention to hire Stevens and Associates, Inc., as its accountants. 20 Finished accounting work for a client and sent the client a bill for $5,400. The client is expected to pay within two weeks. 27 Paid office rent, $1,300. 30 Paid $2,000 of dividends to shareholders of Stevens and Associates, Inc.