Transaction Stockholders' Assets Liabilities Equity Beginning balances $200,000 $80,000 $120,000 1 Borrowed $20,000 cash by signing a note payable with a bank. +20,000 +20,000 0 Collected $7,000 accounts receivable for 2 cash. 3 Paid $8,000 accounts payable in cash. Purchased $2,000 inventory on credit. 4 5 6 Sold common stock to new investors in exchange for $20,000 cash. Paid $12,000 income taxes payable in cash. Ending balances