Using the transactions listed in P3-1 for SLO Health Care, indicate the effects of each transaction on the liquidity metric Quick Assets and the profitability metric Net Income – Accrual Basis.

Data from P3-1

SLO Health Care Inc. is owned and operated by Morgan Denby, the sole stockholder. During January 20Y6, SLO Health Care entered into the following transactions:

Jan. 1 Received $13,500 from Glenn Company as rent for the use of a vacant office in SLO Health Care’s building. Glenn paid the rent nine months in advance.

1 Paid $3,000 for a one-year general insurance business policy.

6 Purchased supplies of $900 on account.

9 Collected $16,000 for services provided to customers on account.

11 Paid creditors $2,500 on account.

18 Invested an additional $5,000 in the business in exchange for common stock.

20 Billed patients $26,000 for services provided on account.

25 Received $7,500 for services provided to customers who paid cash.

30 Paid expenses as follows: wages, $15,500 utilities, $4,250 rent on medical equipment, $2,650 interest, $100 and miscellaneous, $1,500.

30 Paid dividends of $4,000 to stockholder (Dr. Denby).

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Assets Liabilities + Stockholders'Equity Un. Wages Pay. + Rev. + Pay. + Pay. + Accts. Pre. Acc. Accts. Notes Common Retained Cash + Rec. + Ins. + Supp. + Building - Depr. + Land Stock + Earnings Bal, Jan.1 10,000 22,250 350 600 75,000 (5,600) 60,000 3,850 15,000 25,000 118,750