Penny Cassidy has decided to start her business, Penny's Pool Service & Supply, Inc. (PPSS). There is much to do when starting a new business. Here are some transactions that have occurred in PPSS in March. a. Received $39,000 cash and a large delivery van with a value of $50,000 from Penny, who was given 5,400 shares of $0.05 par value common stock in exchange. b. Purchased land with a small office and warehouse by paying $17,000 cash and signing a 10-year note payable to the local bank for $87,000. The land has a value of $25,000 and the building's value is $79,000. Use separate accounts for land and buildings. c. Purchased new computer equipment from Dell for $3,900 cash, and purchased other office equipment for $5,400, signing a note payable due in six months to the office equipment manufacturer. d. Hired a receptionist for the office at a salary of $2,900 per month; the receptionist will begin working for PPSS starting in April. e. Paid $2,400 on the note payable to the bank [in (b) above) at the end of March (ignore interest). f. Purchased short-term investments in the stock of other companies for $6,400 cash. g. Ordered $24,000 in inventory from Pool Corporation, Inc., a pool supply wholesaler, to be received in April. Required: 1. For each of the events, prepare journal entries if a transaction of the business exists, checking that debits equal credits. 2. Use the following T-accounts, and post each of the transactions to determine balances at March 31. Because this is a new business, beginning balances are $0. 3. Prepare a trial balance on March 31 to check that debits equal credits after the transactions are posted to the T-accounts. 4. From the trial balance, prepare a classified balance sheet at March 31 (before the beginning of operations in April). 5. For each of the events, indicate if it is an investing activity (1) or financing activity (F), and the direction (+ for increases; - for decreases) and amount of the effect on cash flows using the following structure. Select NE if there is no effect on cash flows. 6. Calculate the current ratio at March 31. Complete this question by entering your answers in the tabs below. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Required 4 Required 5 Required 6 For each of the events, prepare journal entries if a transaction of the business exists, checking that debits equal credits. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.) View transaction list Journal entry worksheet Record the receipt of $39,000 cash and a van valued at $50,000 in exchange for 5,400 shares with a par value of $0.05 per share. Note: Enter debits before credits. Transaction General Journal Debit Credit a Record entry Clear entry View general journal Required 1 Required 2 Required 3 Required 4 Required 5 Required 6 Use the following T-accounts, and post each of the transactions to determine balances at March 31. Because this is a new business, beginning balances are $0. Cash Short-term Investments Beg. Bal. Beg. Bal. End. Bal. End. Bal. Equipment Land Beg. Bal. Beg. Bal. End. Bal. End. Bal. Buildings Notes Payable (current) Beg. Bal. Beg. Bal. End. Bal. End. Bal. Notes Payable (noncurrent) Common Stock Beg. Bal. Beg. Bal. End. Bal. End. Bal. Required 1 Required 2 Required 3 Required 4 Required 5 Required 6 Prepare a trial balance on March 31 to check that debits equal credits after the transactions are posted to the T-accounts. Credit PENNY'S POOL SERVICE & SUPPLY, INC. Trial Balance March 31 Account Titles Debit Cash Short-term investments Equipment Land Buildings Notes payable (current) Notes payable (noncurrent) Common stock Additional paid-in capital Totals From the trial balance, prepare a classified balance sheet at March 31 (before the beginning of operations in April). PENNY'S POOL SERVICE & SUPPLY, INC. Balance Sheet On March 31 Assets Current Assets Total current assets Total assets Liabilities and stockholders' equity Current Liabilities: Total current liabilities Total liabilities Stockholders' Equity Total stockholders' equity Total liabilities and stockholders' equity Required 1 Required 2 Required 3 Required 4 Required 5 Required 6 For each of the events, indicate if it is an investing activity (I) or financing activity (F), and the direction (+ for increases; for decreases) and amount of the effect on cash flows using the following structure. Select NE if there is no effect on cash flows. Type of Activity (I, F, or NE) Effect on Cash (+ or - and amount) (a) (b) (c) (d) (e) (f) (9) f From the trial balance, prepare a classified balance sheet at March 31 (before the beginning of operations in April). PENNY'S POOL SERVICE & SUPPLY, INC. Balance Sheet On March 31 Assets Current Assets Total current assets Total assets Liabilities and stockholders' equity Current Liabilities: Total current liabilities Total liabilities Stockholders' Equity Total stockholders' equity Total liabilities and stockholders' equity Required 1 Required 2 Required 3 Required 4 Required 5 Required 6 Calculate the current ratio at March 31. (Round your answer to 3 decimal places.) Current ratio