On December 1, Molly Frick started Advancement Career Services, which provided career and vocational counseling services to individuals. The following transactions took place during the month of December:

1 Frick invested \(\$ 10,000\) in the business in exchange for common stock.

2 Paid rent for December on furnished office space, \(\$ 1,250\).

3 Received invoice for December advertising, \(\$ 600\).

4 Borrowed \(\$ 27,000\) from a bank and signed a note payable for that amount.

5 Received \(\$ 4,200\) for counseling services rendered for cash.

6 Billed certain governmental agencies and other clients for counseling services, \(\$ 9,800\).

7 Paid secretary's salary, \(\$ 2,700\).

8 Paid December utilities, \(\$ 370\).

9 Paid stockholders a dividend in the amount of \(\$ 900\).

10 Purchased land for cash to use as a site for the company's future offices, \(\$ 28,000\).

11 Paid \(\$ 100\) to the bank as December interest on the outstanding note payable.

Required

a. Set up an accounting equation in columnar form with the following column headings: Cash, Accounts Receivable, Land, Accounts Payable, Notes Payable, Common Stock, and Retained Earnings.

b. Show how the December transactions affect the items in the accounting equation, and total all columns to show that assets equal liabilities plus stockholders' equity as of December 31.