Using your answer to Problem 1-9A, prepare an income statement, a statement of changes in equity, and a balance sheet.

Analysis Component: Assets are financed by debt and equity. Profit is a component of equity. Therefore, profit helps to finance assets. Explain how/if profit helped to finance assets for Power Electrical for the month ended November 30, 2020.

Problem 1-9A

Larry Power started a new business in the name of Power Electrical on October 1, 2020. During October, a number of activities occurred and the following totals resulted at October 31, 2020 (shown in accounting equation format):

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Assets Liabilities Equity Accounts Office Office Electrical Accounts Larry Power, Capital Cash Receivable Supplies Equip. Equip. Payable $30,000 + $7,000 $1,900 $28,000 $14,000 $18,000 $62,900 Rented office space and paid cash for the month's rent of $7,200. Nov. Purchased electrical equipment for $18,000 from an electrician who was going out of business, by using $10,000 in personal funds and agreeing to pay the balance in 30 days. Purchased office supplies by paying $1,800 cash. Completed electrical work and immediately collected $2,000 for doing the work. Nov. 6. Purchased $5,200 of office equipment on credit. 8. 15 Completed electrical work on credit in the amount of $6,000. Interviewed and hired a part-time electrician who will be paid $5,300 each month. He will begin work in three weeks. 16 Purchased $1,000 of office supplies on credit. 18 20 Paid for the office equipment purchased on November 8. Billed a client $4,800 for electrical work; the balance is due in 30 days. 24 Received $6,000 for the work completed on November 15. 28 Paid the office assistant's salary of $4,400. 30 Paid the monthly utility bills of $3,600. 30 Power withdrew $1,400 from the business for personal use. 30 LO