Required information (The following information applies to the questions displayed below.) Edward Allen Interiors Inc. is a leading manufacturer and retailer of home furnishings in the United States and abroad. The following is adapted from Edward Allen's September 30, 2016, trial balance. (The amounts shown represent millions of dollars.) $ 152 22 124 39 335 Accounts Payable Accounts Receivable Cash Common Stock Equipment Inventory Notes Payable (long-term) Notes Payable (short-term) Prepaid Rent Retained Earnings Salaries and Wages Payable Software 160 195 41 357 32 95 Assume that the following events occurred in the following quarter. a. Paid $30 cash for additional inventory. b. Issued additional shares of common stock for $25 in cash. c. Purchased equipment for $210; paid $100 in cash and signed a note to pay the remaining $110 in two years. d. Signed a short-term note to borrow $13 cash. e Conducted negotiations to purchase a sawmill, which is expected to cost $46. 2. Analyze transactions (a)-(e) to determine their effects on the accounting equation. (Enter any decreases to account balances with a minus sign. Enter your answers in millions (.e., 10,000,000 should be entered as 10).) Assets Liabilities Stockholders' Equity a. Paid $30 cash for additional inventory. b. Issued additional shares of common stock for $25 in cash. c. Purchased equipment for $210; paid $100 in cash and signed a note to pay the remaining $110 in two years. d. Signed a short-term note to borrow $13 cash. e. Conducted negotiations to purchase a sawmill, which is expected to cost $46. "ecord the transaction effects determined in part 2 using journal entries. (If no entry is required for a transaction/event, select "No ournal Entry Required" in the first account field. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) iew transaction list Journal entry worksheet 1 2 3 4 5 Paid $30 cash cash for additional inventory. Record the transaction. Note: Enter debits before credits. Transaction General Journal Debit Credit Record entry Clear entry View general journal 4. Summarize the journal entry effects from part 3 using T-accounts. Use the September 30, 2016, ending balances as the beginning balances for the October-December 2016 quarter. (Enter your answers in millions (.e., 10,000,000 should be entered as 10).) Cash Accounts Receivable Beg. Bal. Beg. Bal. End. Bal. End. Bal. Inventory Prepaid Rent Beg. Bal Beg. Bal. End. Bal. End. Bal. Equipment Software Beg. Bal. I Beg. Bal. End, Bal End, Bal, Accounts Payable Salaries and Wages Payable Beg. Bal. Beg. Bal. End. Bal. End. Bal. Notes Payable (short-term) Notes Payable (long-term) Beg. Bal. Beg Bal. End, Bal End. Bal Common Stock Retained Earnings Beg. Bal. Beg. Bal. End, Bal. End. Bal. 6. Prepare a classified balance sheet at December 31, 2016. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10).) EDWARD ALLEN INTERIORS, INC. Balance Sheet (in millions of dollars) 7-a. Use your response to part 6 to calculate Edward Allen's current ratio after the transactions listed in (a)-(e). (Round your answer to 2 decimal places.) Current ratio after the transactions (a)-(e) 7.b. Based on this calculation and the calculation in part 1, indicate whether the above transactions increase or decrease the company's ability to pay current liabilities. O Increase O Decrease