The following information is for the M & N Fashion Consulting, Inc. M & N Fashion provides

consulting services to clients. Below is the balances at the end of February 20Y5:

Balances as of February 28, 20Y5

Cash $2,500

A/P $5,000

I.S. (Income Statement) $6,300

A/R $6,000

Unearned Revenue $2,000

SCF (Statement of Cash Flow) $2,500

Prepaid Insurance $4,800

Retained Earnings $6,300

1) Record the transactions below on the worksheet for the month of March 20Y5.

March 1 Issued a loan from the bank for $10,000.

March 2 Purchased equipment for $8,000 on account.

March 5 Received $6,500 cash from the issuance to capital stock to its sole

stockholder, Sally, who is the owner of firm.

March 7 Received $4,500 cash from customers for services previously

provided that was on account.

March 9 Purchased supplies $3,500 cash.

March 13 Paid $4,000 for the equipment that was purchased on March 2nd

March 15 Performed services for a customer on account, $3,000.

March 20 Paid wages for $1,200.

March 28 Paid $850 to the bank on the loan, of which $200 was interest and the rest

was a repayment of the loan.

March 30 Paid dividends of $700 to its shareholder, Sally.

March 31 An adjustment is needed: Supplies on hand was $2,800.

March 31 An adjustment was made: Insurance expired, $1,200.

March 31 An adjustment is needed: Equipment depreciated $600 for the month.

March 31 An adjustment was made: Unearned Revenue is earned, $2,000.

2) What effects do all adjustments have on the balance sheet? Income statement? Statement

of cash flows?