2/10/2017. YAD purchases computer equipment for $7,000 cash.

13/10/2017. YAD purchases computer paper and other supplies for $1,600 from ABC Supply Company computer expected to last several months. ABC agrees to allow Microsoft to pay this bill in February.

14/10/2017. YAD receives $1,200 cash from customers for programming services it has provided.

25/10/2017. YAD receives a bill for $250 from the Daily News for advertising but postpones payment until a later date.

26/10/2017. YAD provides $3,500 of programming services for customers. The company receives cash of $1,500 from customers, and it bills the balance of $2,000 on account.

27/10/2017. YAD pays the following expenses in cash for January: rent $600, salaries of employees $900 and utilities $200.

28/10/2017 YAD pays its $250 Daily News bill in cash.

29/10/2017 YAD receives $600 in cash from customers who had been billed for services in transaction number 26/10/2017.

Requirements:

1-Show the effect of the above transactions on the accounting equation (5 marks).

2-Prepare Journal entries to record the above transactions (5 marks).

3-Prepare the T-accounts for cash, account payable and expenses on January 31, 2017 (5 marks).

4-Prepare the financial statements (Balance sheet, income statement, owners equity statement) (5 marks).