Analyzing Transactions and Adjustments Using the Financial Statement Effects Template On March 1, S. Penman launched AniFoods Inc., an organic foods retailing company. Following are the transactions for its first month of business. 1. S. Penman contributed $100,000 cash to the company in return for common stock. Penman also lent the company $55,000. This $55,000 note is due one year hence. 2. The company purchased equipment in the amount of $50,000, paying $10,000 cash and signing a note payable to the equipment manufacturer for the remaining balance. 3. The company purchased inventory for $80,000 cash in March. 4. The company had March sales of $100,000, of which $60,000 was for cash and $40,000 on credit. Total cost of goods sold for its March sales was $70,000. 5. The company purchased future advertising time from a local radio station for $10,000 cash. 6. During March, $7,500 worth of radio spots purchased in transaction 5 are aired. The remaining spots will be aired in April. 7. Employee wages earned and paid during March total $17,000 cash. 8. Prior to disclosing the financial statements, the company recognized that employees had earned an additional $1,000 in wages that will be paid in the next period. 9. The company recorded $2,000 of depreciation for March relating to its equipment. a. Record the effect of each transaction using the financial statement effects template. Note: For each account category, indicate the appropriate account name. Enter "N/A" for any account category that is not used for a given transaction. Note: Indicate a decrease in an account category by including a negative sign with the amount. a. Record the effect of each transaction using the financial statement effects template. Note: For each account category, indicate the appropriate account name. Enter "N/A" for any account category that is not used for a given transaction. Note: Indicate a decrease in an account category by including a negative sign with the amount. Transaction 1. Cash Asset Noncash Assets 175,000 Balance Sheet Liabilities Contrib. Capital Earned Capital Revenues Income Statement Expenses 25,000 150,000 0 - Net Income 0- 0 Cash Notes Payable Cash = = Retained Earnings 2 1 Accounts Payable 1 1 1 1- 1 = 1 Accounts Receivable Accounts Receivable + Cash = Cash 3. 1 Advertising Expense 1 1 1 1 1 = 1 Inventory Cash 4. 1 1 1 1 1 = 1 = = Advertising Expense 1 Common Stock Cost of Goods Sold Depreciation Expense Interest Expense 5. 1 Interest Payable 1 1 1 1 1 1 Advertising Expense + Inventory Accounts Receivable Advertising Expense = Common Stock = Net PPE 6. 1 1 1 1 1- 1 = 1 Notes Payable Accounts Receivable = Accounts Receivable Advertising Expense Advertising Expense Prepaid Advertising 7. 1 1 1 1 1 - 1 = 1 Retained Earnings Advertising Expense Advertising Expense Sales 8. 1 1 1 1 1- 1 = 1 Wages Expense Advertising Expense Accounts Receivable Advertising Expense Wages Payable 9. 1 1 1 1 1 - 1- 1 N/A = Accounts Payable =