P1-2A:

On August 31, the balance sheet of Nashville Veterinary Clinic showed Cash $9,000, Account Receivable $1,700, Supplies $600, Office Equipment $6,000, Account Payable $3,600, Common Stock $13,000, and Retained Earnings $700. During September the following transactions occurred.

1. Paid $2,900 cash for accounts payable due.

2. Collected $1,300 of account receivable.

3. Purchased additional office equipment for $2,100, paying $800 in cash and the balance for account.

4. Earned revenue of $8,000, of which $2,500 is paid in cash and the balance is due in October.

5. Declared and paid a $1,000 cash dividend.

6. Paid salaries $1,700, rent for September $900, and advertising expense $300.

7. Incurred utilities expense for month on account $170.

8. Received $10,000 from Capital Bank on a 6-month note payable.

Instructions:

a) Prepare a tabular analysis of the September transactions beginning with August 31 balances. The column heading should be as follows: Cash + Account Receivable + Supplies + Office Equipments=Note Payable + Account Payable + Common Stock + Retained Earnings + Revenues Expense Dividends.

b) Prepare income statement for September, a retained earnings statement for September, and a balance sheet at September 30.