You purchased a an apartment building and have your first renter.

Your terms for the apartments are:

Rent is $$2,400$ a month,

Pay up front a $$600$ deposit, and

$1$st and last month's rent.

So the renter has to pay up front, $$7,800.$

Joe Smith comes in to rent an apartment,

He agrees to the terms and pays his $$7,800.$

He travels a lot and does not want to have to keep track of the rent, so he decides to pay

Questions $(15$ points each; total $6$ possible points$).$

How would this transaction impact your business? Explain your response.

How should you track of this transaction?

Explain your response and demonstrate using the appropriate financial document$($s$).$

Demonstrate how you would track this transaction for a period of $6$ months.

How does this transaction impact your financial statements? Explain your response and provide an example.

Balance Sheet $($assets $=$ liabilities $+$ equity$)$

Income Statement $($revenue $-$ expenses $=$ net income$/$loss$)$