Bryant Company sells a wide range of goods through two retail stores operated in adjoining cities. Most purchases of goods for resale are on invoices. Occasionally, a short-term note payable is used to obtain cash for current use. The following transactions were selected from those occurring during 2004:

a. Purchased merchandise on credit. $18,000 on January 10. 2004: the company uses a periodic inventory system.

b. Borrowed $40,000 cash on March 1. 2004 from City Bank and gave an interest-bearing note payable: face amount. S40.000. due at the end of six months, with an annual interest rate ot S percent payable at maturity.

Required: 1. Describe the impact of each transaction on the balance sheet equation. Indicate the effects cash + or —), usinc the following schedule: 2. What amount of cash is paid on the maturity date of the note? 3. Discuss the impact of each transaction on Bryant's cash flows. 4. Discuss the impact of each transaction on the current ratio.

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Date Assets Liabilities Stockholders' Equity