Dr. Allen Ronald of Cape Town, South Africa, has worked with animals for more than 25 years. He has been a racehorse groom, a boarding kennel manager, a veterinary technician, and a veterinarian. Dr. Allen Ronald started a sole proprietorship called Vet-to-Pet, a house call practice for dogs and cats. Dr. Allen Ronald visits pets in homes to provide basic veterinary services. He treats illnesses such as skin problems, allergies, ear and eye irritations, minor wounds, and abscesses. Vaccinations and lab screening tests are also administered. Dr. Allen Ronald considers his services to be a supplement to the care given by other veterinarians, and is intended for those who have a hard time getting their pets to a clinic. Dr. Allen Ronald works independently and uses a van to make her house calls. He charges an initial fee, which covers her expenses traveling to the patient's home. This fee varies depending on the distance Dr. Allen Ronald must travel. He also charges for the exam and any treatment, lab work, or medication required. He offers a sliding scale (lower, variable fees) for senior citizens on fixed incomes. He serves individuals with mobility limitations and works with seeing-eye and assistant/working dogs.

Accounting Applications: Instructions:Now that you have reviewed the case study above, answer the following questions on your own.

1.What are the investments Dr. Allen Ronald has probably made in his business and how would each affect the basic accounting equation?

2.What assets might this business have? Liabilities?

3.Identify and classify the accounts affected if Dr. Allen Ronald receives a cash payment for a visit.

4.Identify and classify the accounts affected if Dr. Allen Ronald wrote a check to pay for new veterinary equipment to be use on the van.