Hillary Brennan Corporation was formed on July 1, 1996. On July 31, the balance sheet showed Cash $4,000, Accounts Receivable $1,500, Supplies $500, Office Equipment $5,000, Accounts Payable $4,200, Common Stock $6,500, and Retained Earnings $300. During August the following transactions occurred:

1. Paid \(\$ 3,100\) cash on accounts payable.

2. Collected \(\$ 1,300\) of accounts receivable.

3. Purchased additional office equipment for \(\$ 2,100\), paying \(\$ 800\) in cash and the balance on account.

4. Earned fees of \(\$ 5,900\), of which \(\$ 2,500\) is paid in cash and the balance is due in October.

5. Dividends of \(\$ 600\) were paid.

6. Paid salaries \(\$ 700\), rent for September \(\$ 900\), and advertising expense \(\$ 100\).

7. Incurred utility expenses for month on account, \(\$ 170\).

8. Received \(\$ 8,000\) from Hilldale Bank-money borrowed on a note payable.

\section*{Instructions}

(a) Prepare a tabular analysis of the September transactions beginning with August 31 balances. The column headings should be as follows: Cash + Accounts Receivable +

Supplies + Office Equipment \(=\) Notes Payable + Accounts Payable + Common Stock + Retained Earnings.

(b) Prepare an income statement for September, a retained earnings statement for September, and a balance sheet at September 30.